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IC 885 ° 



Bureau of Mines Information Circular/1981 







Economic Significance of the Florida 
Phosphate Industry 

An Input-Output (I-O) Analysis 



By Anthony M. Opyrchal and Kung-Lee Wang 




UNITED STATES DEPARTMENT OF THE INTERIOR 



°U rut^ ^ - <A^u^ f, ( * t ***»). 



Information Circular 8850 , 

Economic Significance of the Florida 
Phosphate Industry 

An Input-Output (I-O) Analysis 

By Anthony M. Opyrchal and Kung-Lee Wang 




UNITED STATES DEPARTMENT OF THE INTER 
James G. Watt, Secretary 
BUREAU OF MINES 




As the Nation's principal conservation agency, the Department of the Interior 
has responsibility for most of our nationally owned public lands and natural 
resources. This includes fostering the wisest use of our land and water re- 
sources, protecting our fish and wildlife, preserving the environmental and 
cultural values of our national parks and historical places, and providing for 
the enjoyment of life through outdoor recreation. The Department assesses 
our energy and mineral resources and works to assure that their development is 
in the best interests of all our people. The Department also has a major re- 
sponsibility for American Indian reservation communities and for people who 
live in Island Territories under U.S. administration. 






This publication has been cataloged as follows: 



Opyrchal, Anthony M 

Economic significance of the Florida phosphate industry. 

(Information circular - Bureau of Mines ; 8850) 

Bibliography: p. 47. 

Supt. of Docs. no. : I 28.27:8850. 

1. Phosphate industry— Florida. I. Wang, Kung-Lee, joint author. 
II. Title. III. Series: United States. Bureau of Mines. Information 
circular ; 8850. 

TN295.U4 [HD9484.P5U5] 622s [338.2'764l 80-606892 AACR1 



For sale by the Superintendent of Documents, U.S. Government Printing Office 

Washington, D.C. 20402 



Ill 



PREFACE 



This Information Circular, prepared by the Bureau of Mines' Branch of Economic Analy- 
sis, updates the previous Information Circular, "Economic Significance of the Florida Phos- 
phate Industry" (IC 8653, 1974). It presents recent information on the economic impact 
of the Florida phosphate industry and discusses new areas of economic analysis such as 
forward linkage economic impact and fiscal impact analysis. Also employed in this report 
are standard tools of economic analysis, including industrial complex analysis, location 
quotient theory, and — most importantly — input-output techniques with related multiplier 
analyses. 

Included as appendix D is a hypothetical scenario based on the assumption that the 
future impact of Florida's phosphate rock industry will decline. In this scenario, the effects 
of certain anticipated restraints upon Florida's phosphate rock mining industry are ex- 
amined. 

The authors would like to thank William F. Stowasser, phosphate commodity specialist, 
Bureau of Mines, Washington, D.C., for technical and editorial assistance in the preparation 
of this publication. 



IV 



CONTENTS 



Page 

Preface '" 

Abstract 1 

Introduction 2 

Terminology 2 

Historical background 3 

Nature and structure of the present industry — 4 

Mining procedure 4 

Beneficiation 5 

Chemical processes 5 

Current supply and demand for phosphate 

products 5 

Environmental considerations 6 

Economic base studies of two Florida regions 7 

Identification of the impact regions 7 

The economic base model 7 

Data base sources 8 

Regional impact multipliers 9 

Summary 10 

The phosphate industry: an industrial complex 

approach 12 

The regional impact 12 

Polk County 13 

The Port of Tampa 13 

The Ports of Jacksonville and Boca Grande 14 

Rail and motor carrier transportation 15 

Rail shipments 15 

Truck shipments 16 

Electric utilities 16 

State and county tax revenues 17 

Corporate income taxes 17 

Sales and use taxes 18 

Vehicle and motor fuels taxes 18 

Severance taxes 18 

Ad valorem property taxes 19 

Output effect 19 

Employment effect 19 

Income effect 20 

Capital expenditures and operating costs 21 

Summary 21 



Page 
National significance of the Florida phosphate 

industry 22 

Domestic profile 22 

U.S. supply and demand 22 

Income, employment, and output 24 

Taxes 24 

Personal income taxes 24 

Corporate income taxes 25 

Sales and property taxes 25 

Effects on U.S. balance of payments 25 

Impact on the domestic sulfur industry 28 

Uranium recovery from wet-process phosphoric 

acid 29 

Byproduct fluorine production 33 

Importance of phosphate fertilizer to the agricultural 

sector 37 

Use in agriculture 37 

Corn for grain 37 

Cotton 37 

Soybeans for beans 37 

Wheat 37 

U.S. balance of trade 37 

U.S. exports of phosphatic fertilizers 39 

World fertilizer situation review and prospects ... 39 

Phosphate fertilizer outlook 39 

World production and capacity of phosphate rock ... 40 

World production 40 

World capacity 40 

World trade 41 

Conclusions 46 

Bibliography 47 

Appendix A. — Methodology of impact analysis 48 

Appendix B. — Direct impact of the Florida phosphate 

complex on Florida and the United States 50 

Appendix C. — Agricultural forward linkage 56 

Appendix D. — A regional economic impact scenario of 
assumed declines in mineral production for the 

phosphate rock mining industry in Florida 58 



Illustrations 



Page 

1 . Distribution of phosphate deposits in Florida 3 

2. Domestic marketable phosphate rock distribution pattern, 1977 6 

3. Total wages and salaries attributable to the phosphate industry in central Florida in 1977 11 

4. Total wages and salaries attributable to the phosphate industry in northern Florida in 1977 11 

5. Inland, intracoastal, and ocean water routes available for ship and barge movement of phosphate rock in the 

Eastern United States 23 

6. Rail rates at exparte 336 level for selected movements of phosphate rock 24 

7. Domestic use of phosphate as fertilizer, by region, 1 976 25 



CONTENTS— Continued Page 

8. Geographic breakdown of marketable phosphate production in the United States, 196U-77 26 

9. Value of U.S. marketable phosphate rock production, by geographic area, 1960-77 26 

10. Average value of U.S. marketable phosphate rock production, by geographic area, 1960-77 26 

1 1 . Location of phosphate rock production in the United States, 1 977 31 

12. Location of phosphate rock consumers in the United States, 1977 33 

13. Generalized U.S. phosphate rock use pattern 33 

14. Phosphate rock sold or used by producers, by use and by geographic area, 1977 35 

1 5. World production of phosphate rock, by relative share, 1 977 40 

1 6. Florida exports of phosphate rock, by destination, 1 976 44 

1 7. Florida exports of phosphate fertilizer, by destination, 1 976 44 



Tables 



Page 

1 . Chronology of major acquisitions and entries into the phosphate rock industry, 1950-77 4 

2. Phosphate rock and coproducts supply and demand quantities, 1977-78 6 

3. Major specialized industries in Florida and average weekly wages, 1975 8 

4. Employment in major specialized industries in counties of study area, 1975 8 

5. Wages and salaries and income multipliers for all Florida industries, 1975 9 

6. Estimated regional wages and salaries in Florida phosphate industries, 1977 9 

7. Impact of the Florida phosphate industry on local regional wages and salaries, 1977 10 

8. Employment and employment multipliers for all Florida industries, 1975 10 

9. Distribution of employment within the Florida phosphate industry, 1977 10 

10. Regional employment generated by the phosphate industry in Florida, 1977 10 

1 1 . Exports of phosphate products from Tampa, Fla 13 

12. Inbound and outbound traffic through the Port of Tampa for selected commodities related to the phosphate 

industry, 1 977 13 

13. Relative value and tonnage of various cargoes shipped through the Port of Tampa, 1977 14 

14. Port of Tampa imports and exports of selected commodities related to the phosphate industry, 1970-77 14 

15. Port of Jacksonville exports of selected commodities related to the phosphate industry, 1970-76 14 

16. Port of Boca Grande exports of selected commodities related to the phosphate industry, 1970-76 15 

17. Tonnages and means of transportation for selected manufactured goods shipped from Florida to the rest of 

the United States, 1972 15 

18. Tonnages and distribution of chemical and allied products manufactured in Florida and shipped to the rest of 

the United States, by region, 1 972 16 

19. Transportation means used for shipments of Florida and North Carolina, phosphate rock, by destination, 

1976 16 

20. Average cost of electric power in Florida for selected industrial uses 17 

21 . Selected taxes paid or collected by the Florida phosphate industry complex 17 

22. Florida acreage disturbed by phosphate mining and acreage in various stages of reclamation, 1976 18 

23. Selected millage rates for the Florida ad valorem taxes , 1 976 19 

24. Comparison of labor force, earnings, and hours worked for selected industries in Polk County and the State 

of Florida, 1977 19 

25. Effect of Florida phosphate industry output, employment, and income on the State of Florida, as projected 

for 1 981 20 

26. Distribution of operating costs in the Florida phosphate industry, 1977 20 

27. Estimated operating costs and capital expenditures for the Florida phosphate industry, 1978 21 

28. Marketable production of phosphate rock in the United States, by geographic area, 

1960-78 27 

29. Average values of marketable phosphate rock production in the United States, by geographic area, 1960-78 28 

30. Florida phosphate rock producers 29 

31 . Domestic phosphate rock consumers 30 

32. Phosphate fertilizer production capacity in Florida, 1978 31 

33. Phosphate rock producers in States other than Florida 32 



VI 

Tables — Continued 

Page 

34. U.S. phosphate rock production, consumption, sales, and exports; and world production 32 

35. Phosphate rock sold or used by producers, by use and by geographic area, 1973-78 34 

36. U.S. exports of phosphate products and phosphate rock equivalence, 1978 35 

37. Projected income, employment, and output value for the Florida phosphate 35 

38. State, local, and Federal tax revenues associated with the Florida phosphate industry, projections for 1981 . . 35 

39. U.S. foreign trade in agricultural products 38 

40. Value of crop production and exports in the 1977 crop year 38 

41 . Phosphorus pentoxide (P 2 5 ) taken up by various crops, 1976 38 

42. World production of phosphate rock, by county 41 

43. Identified world phosphate reserves and resources 41 

44. Major phosphate rock exporters 42 

45. Exports of phosphate rock, by destination 42 

46. International phosphate rock and fertilizer shipments from Florida, 1976 43 

A-1 . Impact multipliers derived from a 404-sector national input-output (l-O) table for 1972 49 

A-2. Impact multipliers derived from a 338-sector Florida l-O table for 1 972 49 

B-1 . Estimated input requirements as a percentage of total production for the phosphate mining sector of the Flor- 
ida phosphate complex, 1 976 50 

B-2. Estimated input requirements as a percentage of total production for the phosphatic fertilizers sector of the 

Florida phosphate complex, 1 976 51 

B-3. Estimated input requirements as a percentage of total production for the industrial chemicals sector of the 

Florida phosphate complex, 1 976 51 

B— 4. Production by the Florida fertilizer chemicals sector and estimated value, 1976 52 

B-5. Estimated value of purchases by the phosphate mining sector of the Florida phosphate complex, 1976 52 

B-6. Estimated value of purchases by the fertilizer chemicals sector of the Florida phosphate complex, 1976 53 

B-7. Estimated value of purchases by the industrial chemicals sector of the Florida phosphate complex, 1976 .... 54 

B-8. Estimates of the distribution of sales by the mining sector of the Florida phosphate complex, 1976 54 

B-9. Estimates of the distribution of sales by the fertilizer and industrial chemicals sectors of the Florida phosphate 

complex, by product line, 1 976 55 

C-1. Estimated marginal products, phosphatic fertilizer application rates, and average crop prices, 1976 56 

C-2. Estimated crop value attributed to the use of phosphatic fertilizer, 1972 57 

C-3. Comparison of predicted and actual crop yields, 1 976 57 

C-4. Uses of corn as final product, 1 975-76 57 

C-5. Estimated value-added by phosphatic fertilizers to dairy and meat products, 1976 57 

C-6. Total estimated phosphorus-produced retail value of major related final products, 1976 57 

D-1 . Mining and processing permits and approvals 60 

D-2. Estimated tonnage of truck shipments between Tampa and phosphate plants, 1977 60 



ECONOMIC SIGNIFICANCE OF THE FLORIDA PHOSPHATE 

INDUSTRY 

An Input-Output (l-O) Analysis 

by 
Anthony M. Opyrchal 1 and Kung-Lee Wang 2 



ABSTRACT 



This Bureau of Mines study assesses the economic significance of the Florida phosphate 
industry to selected counties in Florida, the State of Florida, and the Nation; it also includes 
a brief survey of the industry's international impact. Based on forecasts of Florida phos- 
phate production in 1981, and using constant 1977 dollars, estimates are given for 1981 
for regional and national output, the value of this output, income, and employment created 
by the phosphate industry in Florida. Federal, State, and county tax revenues generated 
by the State's phosphate industry are also estimated for 1981. The concentrated impact 
of the phosphate industry on certain areas of Florida and on the State's regional industries 
is examined using economic base analysis complimented by an industrial complex ap- 
proach. The industry's impact at the State and national levels is examined through input- 
output analysis. 

In addition, an attempt to forecast for 1990 the effects of constraints on phosphate rock 
mining as a result of economic conditions and other factors is included as an appendix 
to the report. Also discussed is the phosphate industry's importance to the U.S. balance 
of trade; U.S. agricultural production, including forward linkages; the U.S. sulfur industry; 
and the phosphate industry's importance to the production of fluorine and uranium by- 
products from fertilizer manufacturing. 



1 Economist. 

2 Chief, Quantitative Economics. 

Both authors are with the Branch of Economic Analysis, Bureau of Mines, Washington, DC. 



INTRODUCTION 



The United States in recent years has accounted for more 
than 40 percent of the worldwide production of phosphate 
rock. U.S. production has been sufficient to meet domestic 
demand while also allowing considerable exports; only minor 
quantities of phosphate products have been imported in re- 
cent years. The U.S. phosphate rock industry is concentrated 
in three areas — Florida and North Carolina; Tennessee; and 
the western States of Idaho, Montana, Utah, and Wyoming. 
Of the total U.S. phosphate production in 1977 and 1978, 
about 80 percent was from Florida deposits; this means that 
Florida's phosphate production represented about one-third 
of world total. 

The bulk of Florida's phosphate production is from two 
central Florida countries, Polk and Hillsborough. However, 
several recent developments could possibly result in curtailed 
future levels of phosphate rock production from these two 
counties. These developments are related to changing eco- 
nomic conditions, environmental considerations, and other 
factors. A detailed discussion of a scenario that encompasses 
these developments is given in appendix D for the year 1 990. 

The Bureau of Mines undertook this study of the Florida 
phosphate industry as part of its effort to maintain an ade- 
quate supply of minerals to meet national economic and stra- 
tegic needs. The study illustrates the economic significance 
of the Florida phosphate industry to the phosphate-producing 
regions of Florida, the State of Florida as a whole, and the 
Nation, and also gives a brief survey of the industry's inter- 
national impact. An estimate of the industry's impact in these 
areas for a 1-year period (1981) further underscores the im- 
portance of phosphate rock production in the State of Florida. 

This report also provides information on various other as- 
pects of the Florida phosphate industry. Economic base stud- 
ies are described which were conducted on the two principal 
phosphate-producing regions within Florida in an effort to 
quantify direct and indirect employment and income impacts 
of the industry on these small regional economies. An in- 
dustrial complex approach employing input-output (l-O) analysis 
is also used to determine the interrelationships between the 
Florida phosphate industry and various other related indus- 
tries on a statewide basis. Among the interrelationships de- 
termined in this manner are the regional impacts of the State's 
phosphate industry on shipping and other transportation, 
electric utilities, and State tax collections (including property 
taxes paid to counties). The effects of phosphate industry 
activities are estimated for 1981 with respect to output, em- 
ployment levels, and personal income on a statewide basis. 

The national significance of the Florida phosphate industry 
is subsequently described in terms of supply and demand. 
(Factors relevant to changing production levels are discussed 
in appendix D.) Also discussed are the effects of the Florida 
phosphate industry on the U.S. balance of payments, the 
U.S. sulfur industry, and byproduct uranium and fluorine pro- 
duction from phosphate fertilizer processing. 

The vital importance of phosphate fertilizer to the agricul- 
tural sector of the U.S. economy is examined, and the impact 
of the domestic phosphate industry on world consumption of 
phosphate fertilizers is described. Finally, world phosphate 
rock production and its capacity for this production are related 
to future prospects for the Florida phosphate industry. Spe- 
cific conclusions are given at the end of the report. 

The data presented in this report were collected to serve 
as a basis for analysis. In many instances the data are not 
the most recent available. Nonetheless, they are useful for 



demonstrating the various analytical approaches that are 
discussed, and the data and analyses together provide a 
viable profile of the Florida phosphate industry. 



Terminology 

An understanding of the terms used in this report is crucial 
to the various discussions that follow. Therefore, generalized 
definitions are given below for some of the basic terms used 
throughout the report. Other important terms are subse- 
quently defined in the body of the report. 

The phosphate industry refers to the whole scope of that 
industry's operations, from rock mining and beneficiation 
through production of finished fertilizers. Phosphate rock re- 
fers to the marketable product after the mined matrix, con- 
taining pebble and concentrates, waste and tailings, and waste 
colloidal clay particles (slimes), is beneficiated. Phosphate 
rock generally refers to any material containing one or more 
phosphate minerals, usually calcium phosphate. For com- 
mercial purposes, the term marketable phosphate rock is 
applied to the product of a deposit of sufficient quantity and 
purity that it can be used, either directly or after concentration, 
in the manufacturing of commercial phosphate products. 

Central Florida phosphate rock is made up of phosphatized 
limestone, sands, and clay, as well as phosphate pebbles. 
Phosphate pebbles are referred to as either land pebble or 
river pebble depending on the location of the deposit. 

The counties that currently produce significant quantities 
of phosphate in central Florida are Polk and Hillsborough 
Counties, but the central Florida phosphate district circum- 
scribes phosphate deposits over an area of roughly 2,000 
square miles which also includes Manatee, Hardee, and 
DeSoto Counties. The term central Florida phosphate district 
is used in this report to refer to the entire resource area, while 
the term central Florida region is used to refer to the two 
currently producing counties, Polk and Hillsborough. (A small 
amount of the production attributed to the central Florida 
region is mined in Hardee County from the southern extension 
of a deposit located primarily in Polk County.) 

The production of phosphate also takes place in Hamilton 
County, although most of the producer's employees live in 
Columbia County. These two counties in northern Florida are 
referred to as the northern Florida region. Phosphate industry 
employment in Hamilton County represented more than 10 
percent of Florida's total phosphate industry employment in 
1977. 

Other terms commonly used in this report are defined be- 
low. 

Economic base theory (analysis) — the study of cities and 
regions using basic-service ratios, that is, the ratio of em- 
ployment (total or change in total) in basic activities to em- 
ployment in nonbasic activities; the study of regional multi- 
pliers. 

Exports — the sale or transfer of goods and services outside 
the country. 

Florida Phosphate Council — an organization consisting of 
phosphate producers in the State of Florida. 
Imports — the sale or transfer of goods and services into the 
country. 

Input-output (l-O) analysis — the study of the general inter- 
dependence of regional, interregional, and national econo- 
mies. 



Interregional transfers in — the sale or transfer of goods and 

services into a region. 

Interregional transfers out — the sale or transfer of goods and 

services out of a region. 

Location quotient — an analytical device used for comparing 

a region's percentage share of a particular activity with its 

percentage share of some basic aggregate such as income 

or employment. 

Phosphate industrial complex — all companies involved in 

phosphate industry activities in the State of Florida. 

Historical Background 

Land-pebble phosphate deposits were discovered in cen- 
tral Florida in 1877 in an area known as the Bone Valley 
Formation. This area is about 50 miles long and 40 miles 
wide; it includes parts of Hillsborough, Polk, and Hardee 
Counties (fig. 1 ) and is approximately 25 miles east of Tampa. 
The deposits found in this area occur as sedimentary beds 



of phosphate pebbles, sand, and clay. Similar deposits were 
later discovered in Hamilton County, west of Jacksonville. 

Early phosphate mining in central Florida was from river- 
pebble deposits. Production was quite low, amounting to only 
2,720 metric tons in 1 888. As demand for fertilizer increased, 
mining quickly shifted to the land-pebble deposits. The first 
significant mining of these deposits began in 1890. By 1892, 
production had increased to 275,000 metric tons. By 1900 
phosphate production in the central Florida district had in- 
creased to more than 680,000 metric tons per year. Produc- 
tion has continued to rise to more than 3.3 million metric tons 
in 1 930, 1 2.5 million metric tons in 1 960, and nearly 36 million 
metric tons in 1975. In 1978 phosphate rock production in 
central Florida totaled about 40 million metric tons. 

Northern Florida land-pebble mining began in 1 965 in Ham- 
ilton County and currently accounts for about 10 percent of 
the State's total production. 

Since the first mining of land-pebble deposits in central 
Florida in 1880, the Florida phosphate industry has experi- 
enced many technological imorovements that have permitted 




Jacksonville 



LEGEND 

| Northern phosphate region 
J Central phosphate region 



THILiSROnouGH 

piNEiu»s-i. Plant City' 
Tampa 



• County boundary 

• City 



hJ 



20 40 

1 I I 



Figure 1 .—Distribution of phosphate deposits in Florida. 




greater recovery from existing deposits. Examples of these 
improvements are the introduction of electrically driven drag- 
lines to mine the overburden and matrix; the use of high- 
pressure water guns to provide a slurry for the new dredge- 
type pumps; and, most importantly, the introduction of flo- 
tation for recovering fine material that was previously dis- 
carded after washing. 

During the last 30 years, the U.S. phosphate industry has 
characteristically had a relatively small number of producers 
because of the profitability of large-scale operations and the 
geographical concentration of deposits. During the 1950s, 
10 major phosphate rock companies in the United States 
accounted for 80 percent of the total U.S. production. In the 
1960's, these 10 major companies produced more than 85 
percent of the U.S. total. In the 1970's, 15 companies mined 
over 95 percent of the Nation's phosphate rock. Although 
ownership of some of the major companies has changed over 
the past several decades, the same 1 to 15 firms still pro- 
duce most of the phosphate rock in the United States. 



Nature and Structure of the Present Industry 



In their early years, Florida's phosphate operations were, 
for the most part, mining operations. Today, the industry is 
an integrated complex of mining, beneficiation, fertilizer man- 
ufacturing, and other chemical production. This new industry 
structure emerged in the 1960's, a period of rapid expansion 
during which many fertilizer, oil, and chemical firms were 
merged to form integrated companies, as shown in table 1 . 

By the late 1 960's, the marketing patterns of the phosphate 
industry in Florida were comprised of domestic shipments of 
dry phosphate rock to the upper Gulf Coast, with sulfur ship- 



ments returned to Florida; shipments of dry phosphate rock 
along the Atlantic seaboard; and exports of dry phosphate 
rock. This pattern changed slightly in the early 1970's as 
several new chemical fertilizer plants were built on the Gulf 
Coast and lower Mississippi River in closer proximity to sulfur 
deposits and lower cost natural gas. Wet phosphate rock is 
barged to these areas and dried prior to processing. 

Products of the phosphate industry can be classified as 
fertilizers, detergents, animal feeds, food products, and "other." 
The "other" category includes mainly specialized fertilizer 
materials. Most companies involved in phosphate fertilizer 
production have operations that are involved in every step of 
the production chain. Of the 12 companies involved in phos- 
phate mining in Florida in 1977, 10 were also involved in 
beneficiation of the ore as well as processing phosphate 
chemicals. This reflects the degree of vertical integration in 
the Florida phosphate industry. 

Of the companies listed in table 1 , only Mobil Chemical 
Co. and Brewster Phosphate Co. are not currently processing 
phosphate chemicals. T. A. Minerals Corp., (which is not 
listed in the table) also is not currently processing phosphate 
chemicals. Brewster and T. A. Minerals are both small phos- 
phate recovery operations with soft-rock mines. Companies 
that are producing phosphate chemicals but are not involved 
in mining and beneficiation are C. F. Industries, Converse, 
Inc., Electro-Phos Corp., Farmland Industries, and Royster 
Co. 



Mining Procedure 



Current Florida production (1978) of phosphate rock takes 
place in Polk and Hillsborough Counties in the central Florida 



Table 1 .—Chronology of major acquisitions and entries into the phosphate rock industry, 1950-77 1 



1950 1963 

American Agricultural Chemical Corp. Acquired by Continental Oil 

Co. _.. 



1972 

Acquired by Williams Co. 

1972 



1977 

Agrico Chemical Co. 

(Division of the Williams Co.) 



Brewster Phosphate Co. 
(joint venture of American 
Cyanamid Co. and Kerr- 
McGee Corp.) 



American Cyanamid Co. Brewster Phosphate Co.— . 

formed Goint venture of 
American Cyanamid Co. 
and Kerr-McGee Corp.) 
1952 1964 

Cornet Phosphate Co. Acquired by Smith-Douglas __ Acquired by Borden Chemical Co. Borden Chemical Co. 

1954 
Davidson Chemical Corp. .. Acquired by W.R. Grace and Co. W.R. Grace & Co. 

International Minerals & Chemical Corp. International Minerals & 

Chemical Corp. 

Swift & Co. Swift Chemical Co. 

1963 

Virginia-Carolina Chemical Corp. Acquired by Socony Mobil Co. Mobil Chemical Co. 

1955 1968 

Armour Fertilizer Co. _ Acquired by U.S. Steel Corp. U.S.S. Agri-Chemicals, Inc. 

(Initiated phosphate (owned by U.S. Steel Corp.) 

rock production) 

1965 

Occidental Oil Co. Occidental Agricultural 

(initiated phospate rock production) Chemical Co. 

1966" 

Texasgulf Corp. Texasgulf, Inc. 

(initiated phosphate rock production) 
1967 1973 

Cities Service Acquired by Societe des .. Societe des Participation 
Corp. Participation Gardinier Gardinier. 
(initiated phosphate rock production) 

1 This table does not include Tennessee and Western States producers; two small recovery operations and soft-rock mines are also excluded. 
Source: Florida Phosphate Council (32). 



region, with Hardee County also contributing a small amount. 
Production in the northern Florida region takes place in Ham- 
ilton County. There is also additional mining potential in DeSoto 
and Manatee Counties. 

The mining procedures used in the Florida land-pebble 
phosphate field is to strip the overburden and mine the phos- 
phate matrix with a dragline. As cuts are made by the dragline, 
overburden is placed on adjacent mined-out areas, and the 
matrix is stacked in a sluice pit prepared on unmined ground. 
The matrix is then mixed with water under high pressure to 
produce a slurry, and the slurry is pumped to a washing plant 
for beneficiation. A typical 3-million-ton-per-year operation 
annually mines about 400 acres of land, removing 13 million 
cubic yards of overburden and producing 9 million cubic yards 
of matrix. Mined-out areas are used for disposal of tailings, 
slime ponds, and redistribution of overburden. Approximately 
1 ton of sand tailings and 1 ton of phosphate clay must be 
disposed for each ton of marketable phosphate rock pro- 
duced. Overburden and sand tailings are used to construct 
holding dams in mined-out areas, where phosphatic clay slimes 
are impounded to settle and dewater. 

Water is used in the beneficiation process and as a trans- 
portation medium. Both freshwater from deep wells and re- 
claimed water from sand tailings and slime-settling ponds are 
used. It is estimated that the production of 1 ton of marketable 
phosphate rock requires 10,000 gallons of water, but about 
85 percent of this water is reclaimed and recycled. 



Beneficiation 



Methods of phosphate beneficiation differ only slightly as 
a function of the size analysis of the feed; the ratio of washer 
rock to flotation feed; and the proportions of sand, clay, and 
phosphate in the matrix. The matrix is broken down by a 
series of screens in closed circuit with hammermills and log- 
washers to separate the clay and sand from the phosphate 
pebbles. The washer produces phosphatic clay slimes and 
a sized flotation feed and recovers a pebble product. 

Concentrates are floated from the minus 1 4- plus 1 50-mesh 
fraction. The waste or tailings from the flotation process are 
used in both holding dam construction and land reclamation. 
The marketable phosphate rock obtained through beneficia- 
tion is sold as a final product or used captively as a raw 
material to produce a variety of chemical products. 



Chemical Processes 



After beneficiation, phosphate rock still contains from 7 to 
20 percent moisture. Although some processes use phos- 
phate rock wet-ground at these moisture levels, phosphate 
rock commonly sold in domestic and export markets contains 
less than 3 percent moisture. Drying the rock facilitates ship- 
ping in below-freezing temperatures and also reduces freight 
costs by reducing the weight. Rock drying is required to pro- 
duce triple superphosphate (TSP), or if the rock is to be 
shipped to a wet-process phosphoric acid plant that cannot 
accept wet-ground rock. Phosphate rock dryers are mostly 
fueled by natural gas, but can also use oil as a standby fuel. 
If the rock contains a high percentage of organic material, it 
must be calcined at temperatures higher than those normally 
required for drying. 

A wide variety of agricultural and industrial chemicals is 



produced by Florida's phosphate processing operations. This 
production requires large q"antities of elemental sulfur and 
anhydrous ammonia, which are imported or brought in from 
other States. Elemental sulfur is the primary raw material 
used in the production of sulfuric acid, which in turns is used 
to produce wet-process phosphoric acid and normal super- 
phosphate, the ammonia is reacted with phosphoric acid at 
varying degrees of neutralization to produce different grades 
of ammonium phosphates. 

Phosphoric acid is produced from sulfuric acid and phos- 
phate rock. It is used to manufacture ammonium phosphates 
as well as TSP. TSP is a high-analysis product made by 
reacting phosphoric acid with dry phosphate rock. It is used 
as a direct-application nutrient in farming and in the manu- 
facture of high-analysis-grade fertilizer. 

An important group of chemical products produced by the 
Florida phosphate industry is the ammonium phosphate group. 
Grades produced in Florida from wet-process phosphoric acid 
are labeled 18-46-0, or modified diammonium phosphate 
(DAP), and 13-52-0, or primary monoammonium phosphate 
(MAP). The three numbers indicate respectively, the per- 
centages of total nitrogen, available phosphate as P 2 5 , and 
soluble potash as K 2 0. 

Normal superphosphate, which contains between 16 and 
20 percent available phosphate, is produced by reacting sul- 
furic acid with phosphate rock. After curing, normal super- 
phosphate is disintegrated for commercial use both in direct 
application and with other plant nutrients in the production of 
mixed fertilizers. With the rising demand for higher analysis 
fertilizers, however, both the dem?nd for and production of 
normal superphosphate have dec'ined. 

Super phosphoric acid, which >o used as a phosphate in- 
termediate, is a concentrated phosphoric acid produced from 
either the wet process or from furnace orthophosphoric acid. 
Water is evaporated to produce the super acid. Elemental 
phosphorus is produced by smelting phosphate rock with 
coke and quartz in electric furnaces. This smelting operation 
also produces ferrophosphorus, carbon monoxide, and cal- 
cium silicate. About 50 percent of the elemental phosphorus 
produced is used to produce sodium phosphate detergents. 

Also produced from phosphate rock are animal-feed-grade 
phosphates. Phosphate rock is used to produce low-fluorine 
mineral supplements for livestock and poultry feed. Defluor- 
ination, which is necessary because fluorine is toxic to ani- 
mals, is accomplished by adding defluorinating agents such 
as phosphoric acid and soda compounds in controlled amounts 
to phosphate rock and calcining the mixture at high temper- 
atures. Defluorinated phosphoric acid is reacted with lime to 
produce dicalcium phosphates. 

Fluorine and its related products are byproducts of the 
Florida phosphate industry. One of these, hydrofluosilicic acid, 
is used to treat drinking water and is also converted into a 
synthetic cryolite. 

Current Supply and Demand for Phosphate 
Products 



The elements of supply and demand for the U.S. phosphate 
industry during 1977 and 1978 are shown in table 2. Figure 
2 is a detailed flowsheet of U.S. demand for 1977. In recent 
years the United States has furnished more than 40 percent 
of the world's supply of phosphate rock, and most of the U.S. 
production has come from Florida. The United States is self- 
sufficient in phosphorus and imports less than 1 million tons 



Table 2.— Phosphate rock and coproducts supply and 
demand quantities, 1977-78 

(Thousand metric tons and percent) 





1977 


1978 




Tonnage 


Share 


Tonnage 


Share 


World production: 

United States 


47,256 
68,692 


40.8 
59.2 


50,037 
74,963 


40.0 


Rest of world 


60.0 






Total 


115,948 


100.0 


125,000 


100.0 


U.S. supply components: 

Domestic mines 

Imports 

Industry stocks, Jan. 1 


47,256 

158 

13,777 


77.2 

.3 

22.5 


50,037 

908 

13,818 


77.3 

1.4 
21.3 


Total U.S. supply 


61,191 


100.0 


64,763 


100.0 


Distribution of U.S. supply: 

Industry stocks, Dec. 31 ... 

Exports 1 

U.S. demand 

Apparent supply deficit 2 ... 


13,818 

13,230 

34,365 

-222 


22.6 
21.6 
56.2 
-.4 


15,081 

12,870 

36,812 




23.3 

19.9 

56.8 




Total 


61,191 


100.0 


64,763 


100.0 


U.S. demand components: 

Fertilizer 

Detergents 

Animal feeds 


30,262 

1,760 

601 

285 

1,457 


88.1 

5.1 

1.8 

.8 

4.2 


31 ,958 

2,185 

700 

368 

1,601 


86.8 
5.9 
1 9 


Food products 


1.0 


Other 


4.4 


Total U.S. primary 
demand 


34,365 


100.0 


36,812 


100.0 



1 Exports reported by companies to the Bureau of Mines. 

2 Difference between distribution of U.S. supply and total U.S. supply. 

per year. The historical trend in phosphorus applications and 
demand has been stable, but there are some indications that 
there is a shift towards exporting higher value processed 
phosphate products rather than untreated phosphate rock. 

In 1 977 the largest domestic end use of phosphate prod- 
ucts was for agriculture, which accounted for 88 percent of 
U.S. consumption. The chief agricultural product was inter- 



mediate phosphoric aid, which comprised 79 percent of the 
total demand for phosphate rock in 1977. Phosphoric acid 
was used to produce diammonium phosphate, triple super- 
phosphate, and, after defluorination, dicalcium phosphate. 
Only 1 1 .9 percent of U.S. phosphate consumption went to 
industrial applications, and nearly all of this consumption was 
as elemental phosphorus. About 5 percent of the industrial 
consumption was used in making detergents. Elemental 
phosphorus was also used to produce furnace phosphoric 
acid, from which a variety of sodium, calcium, and potassium 
phosphates were manufactured. 

Environmental Considerations 

Environmental problems associated with the phosphate 
industry include concerns about excessive water consump- 
tion and power demands, the effects of radiation, water and 
air quality, and the adequacy of land reclamation programs. 
In a recent Bureau contract report (38), 3 an attempt was made 
to quantify the environmental sensitivity of future phosphate 
resource development in Florida. The report identifies Flor- 
ida's present and future phosphate resources and also iden- 
tifies those phosphate resources which may be of special 
concern because of inadequate water supply, radiation, or 
the potential for wetlands disturbance. The report evaluates 
the phosphate resource potential of Florida on a deposit-by- 
deposit basis, identifying areas of land, water, vegetation, 
wildlife, etc. For each deposit, the report includes an evalu- 
ation of the overall environmental sensitivity to phosphate 
mining with respect to both shot- and long-term effects. 

It is emphasized that this study is intended to outline the 
direct economic benefits of the Florida phosphate industry 
and is not intended to identify environmental costs. In this 
study, no estimates are made of the economic costs of the 
industry's current or potential environmental problems. 



1 Underlined numbers in parentheses refer to items in the Bibliography pre- 
ceding the appendixes. 



U.S. DEMAND 

(34,207) 

100% 







' 


' 






INDUSTRIAL 






(4,084) 






11. 


9% 




1 


' 




' 




PHOSPHORU 


S ELEMENTAL PHOSPHORUS 


(180) 


(3,904) 




0.5% 


11. 


4% 






i 

DETERGENTS 


1 

OTHER 




(1,750) 


(2,154) 








5.1% 




6.3% 



AGRICULTURE 
(30,123) 
88.1% 



PHOSPHORIC ACID TRIPLE NORMAL OTHER 

(27,024) SUPERPHOSPHATE SUPERPHOSPHATE (334) 

79.0% (1,852) (913) 1.0% 

5.4% 2.7% 



Figure 2.— Domestic marketable phosphate rock distribution pattern, 1977, in thousand metric tons. 



ECONOMIC BASE STUDIES OF TWO FLORIDA REGIONS 



This section seeks to quantify direct and indirect employ- 
ment and income impacts of the Florida phosphate industry 
on two small regional economies. The localized regions of 
impact are identified, a survey of economic base theory is 
presented, and statistics generated by application of the the- 
ory to the phosphate industry are provided. 



Identification of the Impact Regions 



The Florida phosphate industry is concentrated in a rela- 
tively small geographical area. In 1978 phosphate rock was 
mined in only four Florida counties. Most of this mining was 
in Polk County in central Florida, and lesser amounts were 
mined in Hardee and Hillsborough Counties, also in central 
Florida, and Hamilton County in northern Florida. In 1978 
Polk and Hillsborough Counties accounted for 90 percent of 
Florida's phosphate employment. 

The primary objective of this economic base study was to 
identify as precisely as possible the regions in which the 
greatest expenditures attributable to the phosphate industry 
were made. Two Florida regions were so identified, the cen- 
tral Florida region, which includes Polk and Hillsborough 
Counties, and the northern Florida region, which includes 
Hamilton and Columbia Counties. 

In the central Florida region, a preponderance of the local 
indirect income and expenditures flowing from phosphate in- 
dustry employment in central Florida was generated within 
Polk and Hillsborough Counties, where most workers em- 
ployed locally by the industry reside. Large metropolitan areas 
within these counties provide support goods and services to 
employees. The mining currently taking place in Hardee County 
is from a deposit in Polk County that extends over the county 
line, and most of the income from this mining remains in Polk 
County. 

The situation in the northern Florida region is somewhat 
different. A large number of the mining and processing em- 
ployees at the Hamilton County operation live in adjoining 
Columbia County. Therefore, the impact of the industry is 
spread across both counties. Both counties are predomi- 
nantly agricultural; the phosphate industry is the only major 
industrial enterprise. 

A second objective of this economic base study was to 
gage the impact of the Florida phosphate industry with re- 
spect to the entire State of Florida. Although the greatest 
impact is localized within the two phosphate regions, there 
are some ripple effects throughout the Florida economy. This 
is because the local goods and services suppliers in the two 
regions rely on other Florida counties and cities for some of 
their resources. The State of Florida itself can be viewed as 
a region and is treated as such in a subsequent section of 
this study. 

Most of the phosphate rock and derivative products pro- 
duced from Florida deposits is shipped to other States and 
to foreign nations. The two regions under analysis, central 
Florida and northern Florida, can be considered subregions 
of the United States in terms of this economic activity. There- 
fore, the economic impact variables used in this study utilize 
the rest of the United States as the base region to which 
these two subregions transfer goods and services. The phos- 



phate industry does not transfer services, but the services 
are embodied in the goods. 



The Economic Base Model 



The intention of an economic base study is to provide the 
most accurate description possible of the sources and levels 
of income and employment in a region by identifying particular 
key economic activities. Such a study hypothesizes that the 
key economic activities of a region — those that direct and 
determine the development of the region — are the activities 
of the industries, firms, and individuals that serve markets 
outside the region. All other industries, firms, and individuals 
of the local economy are categorized as those which serve 
markets within the region. The theory is closely related to 
the theory of foreign trade impact on the domestic economy. 

Goods and services sold outside the boundaries of a region 
are defined as interregional transfers out (ITO's). The re- 
mainder of goods and services goes to the local market, 
which is defined as all areas within the geographic region 
under analysis. The local market may include a State, a county, 
a city, or any other designated market area. In this economic 
base study, the local regions are the central Florida and the 
northern Florida region. 

An ITO industry is an industry that produces an amount of 
output greater than that which can be consumed in the local 
market area. The ITO market, which is made up of ITO in- 
dustries, is similar in concept to an export market, except 
that ITO's refer to transfers from one region in a country to 
another region within the same country. The extra output of 
the ITO market is transferred or sold outside the region or 
local market area. 

Both the employment and income of the regions are af- 
fected by ITO markets, the driving force of local economies. 
Employment offering services to the ITO markets is termed 
basic, while employment serving the local market is consid- 
ered nonbasic. Employment by an industry or a firm within 
an industry is often divided between the basic and nonbasic 
categories in an economic base analysis. Basic (ITO) em- 
ployment plus nonbasic (local) employment, when summed 
for all industries, equals the total employment of the region. 

The first step in identifying the impact of changes in the 
basic sector on the local economy is to allocate the units of 
measure (either employment or income) to the proper sec- 
tors. This can be accomplished by direct measurements through 
a comprehensive survey of all firms, but in actual practice, 
the survey procedure is almost always bypassed because of 
its prohibitive cost. A more widely accepted alternative is to 
measure the ITO industries indirectly, using location quo- 
tients. Employment is used as the unit of measure for most 
indirect measurement methods, but in this study both em- 
ployment and income measures are used. 

An explanation of location quotients and a concept similar 
to ITO employment appears in reference 16. Location quo- 
tients and multipliers have been estimated in terms of em- 
ployment and income for each of the defined regions. The 
chief interest in this section is the direct and indirect em- 
ployment and income effects of changes in output in the 
Florida phosphate industry. 



Table 3.— Major specialized industries in Florida and average weekly wages, 1975 





SIC 1 


Employment 
location 
quotient 


Average 
weekly wage 


Industry 


Florida 


United 
States 


Building construction; general contractor and 

operative builders 2 

Lumber and other building materials dealers 

Loan correspondents and brokers 

Office of chiropractors 


15 
521 
616 
804 
147 
569 
286 

071 
736 
012 
287 
09 

794-799 
073 
NAp 


15.44 
13.08 
8.89 
6.89 
5.96 
5.84 
5.59 

5.30 
4.58 
3.72 
3.66 
3.23 

3.12 
3.06 
NAp 


$202 
174 
235 
166 
230 
115 
253 

171 
91 
192 
241 
173 

133 
133 
166 


$254 

193 

246 

96 


Chemical and fertilizer mineral mining 

Miscellaneous apparel and accessory stores 

Gum and wood chemicals 


252 
104 
220 


Agricultural services, except animal husbandry 

and horticultural services 

Private employment agencies 


148 
120 


Fruit, tree nut, and vegetable farms 

Agricultural chemicals . 


165 
206 


Fishing, hunting, and trapping 2 


263 


Commercial sports and miscellaneous 
amusement and recreational services 2 


128 


Horticultural services _ _ 


164 


All industry 


183 







NAp Not applicable. 

1 Standard Industrial Classification. 

2 These SIC's are aggregated at higher than three-digit levels. 

Source: Florida State University (study done under contract to the Bureau of Mines) (6). 



Data Base Sources 



Because of the availability of comprehensive data at the 
three-digit Standard Industrial Classification (SIC) 4 working 
level, employment and income data for 1975 were used for 
the economic base model estimates. The national data are 
from the Bureau of Labor Statistics (BLS), U.S. Department 
of Labor. The income figures are wage and salary estimates 
based on first-quarter 1975 data, and the employment figures 
are annualized averages. Florida employment and payroll 
data were provided by State government sources. The State 
wage and salary figures are those reported for the whole 



4 A classification described in the Standard Industrial Classification Manual, 
1972, published by the Executive Office of the President, Office of Man- 
agement and Budget. 



year. The obtained data provide a basis for comparability 
between SIC industries in the Nation, the State, and the coun- 
ties, in most cases. 

Location quotients for the central Florida and northern Flor- 
ida regions were computed using the procedure described in 
reference 16. One set of quotients is based on employment 
data; the other is based on industry wages and salaries. Both 
types of quotients are derived from three-digit SIC industries, 
with some exceptions. 

Table 3 shows the leading specialized industries in Florida, 
based on the location quotient method. Industries that had 
an employment location quotient greater than 3.00 and a 
minimum of 1,000 workers employed during the year are 
listed. (An employment location quotient greater than 3.00 
generally identifies an industry that has strength and potential 
for further development within the region.) These basic in- 
dustries, which serve markets outside Florida, include two 



Table 4.— Employment in major specialized industries in countries of study area, 1975 



Industry 



SIC 



Employment location quotient 



Polk 



Hamilton 



Hills- 
borough 



Columbia 



Chemical and fertilizer mineral mining 

Agricultural chemicals 

Agricultural services, except animal husbandry 

and horticultural services 

Building construction; general contractor and 

operative builders 

Lumber and other building materials dealers ... 

Fruit, tree nut, and vegetable farms 

Commercial sports and miscellaneous 

amusement and recreational services 

Offices of chiropractors 

Horticultural services 

Miscellaneous apparel and accessory stores .. 

Private employment agencies 

Loan correspondents and brokers .._ 

Gum and wood chemicals 

Fishing, hunting, and trapping 3 



147 
287 

071 

15 
521 
012 

794-799 
804 
073 
569 
736 
616 
286 
09 



161.70 
35.69 

26.54 

25.27 
24.00 

14.55 

7.57 
6.49 
2.63 
2.02 
1.93 
1.11 
NAp 
NAp 



220.08 2 
225.80 2 

NAp 

10.20 

10.24 

NAp 

7.04 
8.87 
7.70 
NAp 
NAp 
NAp 
NAp 
NAp 



3.83 
14.46 

4.24 

17.48 
8.50 
2.84 

12.66 
6.77 
2.40 
6.95 
9.95 
5.09 
NAp 
4.39 



NAp 
NAp 

NAp 

41.39 
NAp 
NAp 

5.06 
NAp 
NAp 
NAp 
NAp 
NAp 
NAp 
NAp 



NAp Not applicable. 

1 Standard Industrial Classification. 

1 Florida State University location quotients adjusted by the Bureau of Mines. 

3 These SIC's are aggregated at higher than three-digit levels. 

Source: Florida State University (study done under contract to the Bureau of Mines) (6). 



that are largely comprised of phosphate industry activities — 
chemical and fertilizer mineral mining (SIC 147) and agri- 
cultural chemicals (SIC 287). Chemical and fertilizer mineral 
mining ranks sixth among ITO industries in Florida, and ag- 
ricultural chemicals processing ranks tenth. 
This analysis leads to three major conclusions: 

1. Phosphate rock mining and agricultural chemicals pro- 
duction are among Florida's leading ITO industries (as de- 
fined by location quotients). 

2. In pure economic terms, the phosphate industry repre- 
sents a growth leader for the State of Florida. 

3. Without the phosphate industry, a major economic ca- 
talyst would be lost. 

Average weekly wages and salaries for Florida's and the 
Nation's specialized industries are also reported in table 3. 
Average U.S. wages were about 10 percent higher than the 
Florida average; but for agricultural chemicals, which ac- 
counted for 41 percent of all 1976 phosphate industry em- 
ployment in Florida, average wages were 17 percent higher 
in Florida than the nationwide average. However, the national 
wage differential in chemical and fertilizer mineral mining (SIC 
147) was about equal to the Florida average difference. In 8 
of the 14 leading Florida ITO industries, the national average 
wage was higher than the Florida average. 

The major specialized industries in the study regions are 
listed for 1975 in table 4. Although Polk County has a diverse 
industrial base, chemical and fertilizer mineral mining (SIC 
147), with a location quotient (LQ) of 161.70, is by far its 
leading ITO industry. Agricultural chemicals (SIC 287), with 
an LQ of 35.69, is the second leading basic industry in Polk 
County and also in Hillsborough County. However, chemical 
and fertilizer mineral mining is relatively insignificant in Hills- 
borough County. 

In Hamilton County the leading ITO industries are chemical 
and fertilizer mineral mining, with an LQ of 220.08, and ag- 
ricultural chemicals production, with an LQ of 225.80. Ham- 
ilton County's other industries include those that service the 
phosphate industry, and a few other industries such as build- 
ing construction, lumber, and other building materials dealers. 
Neighboring Columbia County, like Hamilton County, is not 
significantly industrialized; building construction is its leading 
ITO industry. Even though Columbia County's economic ac- 
tivity is influenced by the phosphate industry in Hamilton County, 
there is no phosphate mining or agricultural chemical pro- 
duction in the county. 

From table 4 it can be seen that the phosphate industry 
(SIC 147) leads Polk County's ITO industries in employment, 
even though the county has an otherwise diverse industrial 
base. In Hamilton County, however, it is the lack of industrial 
diversity that makes the phosphate industry the leading ITO 
employer. 

Regional Impact Multipliers 

Regional impact multipliers are the ratio of total income to 
basic income, or of change in total income to change in basic 
income. Employment is also used to estimate these multi- 
pliers. Regional impact multipliers are used to make projec- 
tions of future levels of income and employment. 

Regional impact multipliers were computed in conformity 
with the economic base theory described in reference 16. 
First, the location quotients were used to identify the basic 
(ITO) and nonbasic (local support) industries. Second, the 
total wages and salaries paid by each ITO industry were 
estimated. This procedure was repeated for each industry, 



Table 5. — Wages and salaries and income multipliers 
for all Florida industries, 1975 



Central 
Florida 



Northern 
Florida 



Nonbasic wages and salaries. ..millions 

Basic income do 



$1,893.8 
$929.3 



$60.4 
$37.5 



Total wages and salaries 
Regional income multiplier 



_do_ 



$2,823.1 
'3.04 



$97.9 
1 2.61 



1 These income multipliers are based on location quotients calculated by Flor- 
ida State University as part of a study done under contract to the Bureau 
of Mines (6). 

Source: Various Florida State government agencies. 

and the total wages and salaries of all industries — both IIU 
and local — were summed. The ratio of total regional income 
to ITO income was the income multiplier. The technique used 
to derive regional employment multipliers was the same. Such 
estimates can be made for any region for both types of mul- 
tipliers; in this case, the selected regions were central and 
northern Florida. The multipliers used were the average mul- 
tipliers for all the industries in the region, and not just those 
of the phosphate industry. 

The location quotients in tables 3 and 4 show that the 
Florida phosphate industry was a major ITO industry in both 
regions in terms of both employment and income. Income 
multipliers for the two regions were derived by summing the 
total wages and salaries table 5 and determining the ratio of 
the regions' total wages and salaries to their ITO (basic) 
incomes for 1975, the most recent year for which income 
data were readily available. The resultant income multipliers 
were 3.04 for central Florida and 2.61 for northern Florida. 
These multipliers were averages for all industries in the study 
areas. 

An industry's direct impact is the wages, salaries, and 
employment that it generates. Estimated payroll, or income, 
data for the Florida phosphate industry are given by region 
in table 6 for 1977. Nearly all of the total payroll of more than 
$153 million was divided equally between phosphate rock 
mining (SIC 1475) and phosphate fertilizer production (SIC 
2874); a small amount also came from the production of 
industrial inorganic chemicals, including elemental phospho- 
rus (SIC 2819). Less than 3 percent of this total payroll was 
earned outside the two study regions. 

Each industry also has an indirect impact which stems from 
certain basic needs that are shared by all of the industry's 
employees. These needs include food, clothing, shelter, and 
other goods and services provided by the local support econ- 
omy. In this study, local support for the primary industry is 
viewed as the industry's indirect impact; it is equal to the 
direct income (or employment) multiplied by the value of the 
income (or employment) multiplier, less the total direct in- 
come (or employment). Multiplying the regional phosphate 
industry wages and salaries (table 6) by the income multi- 
Table 6.— Estimated regional wages and salaries 1 in 
Florida phosphate industries, 1977 

(Millions) 





Central 

Florida 


Northern 
Florida 


Phosphate rock mining 

Industrial chemicals 


$68.2 

1.7 

67.9 


$7.6 
NAp 


Phosphate fertilizers 


8.0 


Total 


137.8 


15.6 



NAp Not applicable. 

1 Rounded to nearest thousand dollars. 



10 



Table 7.— Impact of the Florida phosphate industry on 
local regional wages and salaries, 1977 1 

(Millions) 





Central 
Florida 


Northern 
Florida 


Direct 

Regional indirect . 


$137.8 
281.1 


$15.6 
25.1 


Total 


418.9 


40.7 



1 Based on Florida State Department of Commerce wage and employment 
data, Florida Phosphate Council employment data, and income multipliers 
calculated by Florida State University. 



Table 9.— Distribution of employment within the Florida 
phosphate industry, 1977 





Central 
Florida 1 


Northern 
Florida 1 


Phosphate rock mining 

Industrial chemicals 


5,300 

200 

5,100 


585 

NAp 


Phosphate fertilizers 


615 


Total 


10,600 


1,200 



NAp Not applicable. 
1 Rounded numbers. 

Source: State of Florida employment statistics, including unpublished data; 
and individual Florida phosphate companies. 



pliers (table 5) shows that the phosphate industry generated 
a total direct and indirect impact of $418.9 million in central 
Florida and more than $40.7 million in northern Florida (table 

7). 

Employment multipliers for the two regions were deter- 
mined by summing total employment in each region and com- 
puting the ratio of total employment to ITO (basic) employ- 
ment (table 8). Although the income multipliers were deter- 
mined using 1975 as a base year, the employment multipliers 
were determined using 1977 data. However, it is unlikely that 
the location quotients and multiplier ratios changed from 1 975 
to 1977, since the factors that determine the magnitude of 
these multipliers were not altered during this period. 

The employment multipliers were 2.62 for the central Flor- 
ida region and 2.17 for the northern Florida region. These 
multipliers corresponded with the ranking of the two regions' 
income multipliers, except that the employment multipliers 
were smaller than the income multipliers for each region. This 
was so because the national wage rates were higher, on the 
average, than Florida's wage rates, as shown in table 3. 

Table 9 provides a breakdown of employment distribution 
for the phosphate industry in the two regions. The totals shown 
include any administrative personnel necessary for the op- 
eration of each subindustry. In terms of percentages, the 
subindustry employment totals correspond with the subin- 
dustry income totals presented in table 6. 

Regional employment impacts of the Florida phosphate 
industry, both direct and indirect, are shown in table 10. Mul- 
tiplying the direct employment (table 9) by the estimated 
multiplier (table 8) for each region equals total employment, 
which includes indirect employment. In the central Florida 
region, more than 27,000 jobs are directly or indirectly related 
to phosphate production; in the northern Florida region, phos- 
phate-related jobs total more than 2,600. 

As a measure of the importance of these total levels of 
phosphate industry wages and salaries and employment (direct 
plus indirect impacts), phosphate-related wages and salaries 



Table 8.— Employment and employment multipliers for 
all Florida industries, 1975 





Central 
Florida 


Northen 
Florida 


Nonbasic employment 

Basic employment __ 


189,067 
115,520 


6,433 
5,490 


Total employment -.. 


304,587 
1 2.62 


1 1 ,923 


Regional employment multiplier 


1 2.17 







and employment were calculated as percentages of the total 
regional income and employment for the central and northern 
Florida regions. These percentages were calculated for 1 975, 
using the data from tables 5 and 8 plus 1975 industry wage 
and salary data collected from the phosphate companies and 
Florida State government agencies. The calculations showed 
that in the central Florida region, where about 90 percent of 
the Florida phosphate industry is located, an estimated 13 
percent of the region's total wages and salaries and 8 percent 
of its total employment were generated either directly or in- 
directly by the phosphate industry. In northern Florida, the 
respective percentages were approximately 40 and 21, re- 
flecting the low level of industrialization in Columbia and Ham- 
ilton Counties. Percentage shares for succeeding years would 
likely be similar. 

There are a number of possible reasons why the employ- 
ment shares were smaller than those for wages and salaries. 
One factor was that the multipliers for wages and salaries 
were larger than the employment multipliers. This is because 
the phosphate industry is capital-intensive, with a relatively 
large ratio of capital investment to labor employment. And, 
as shown in table 3, the wage rates in the phosphate industry 
were well above the average wages for the State. (This av- 
erage wage differential is also shown in table 24, in the sec- 
tion, "The Phosphate Industry: An Industrial Complex Ap- 
proach.") 



Summary 



Two phosphate industry impact regions have been defined, 
the central Florida region, which includes Polk and Hillsbor- 
ough Counties, and the northern Florida region, comprising 
Hamilton and Columbia Counties. In the northern Florida re- 
gion, phosphate production takes place only in Hamilton 
County. 

In these regions the phosphate industry is an ITO industry 
that generates income and employment for other local in- 
Table 10.— Regional employment generated by the 
phosphate industry in Florida, 1977 1 



1 These employment multipliers are based on location quotients calculated by 
Florida State University as part of a study done under contract to the 
Bureau of Mines (6). 

Source: Various Florida State government agencies. 





Central 
Florida 


Northern 
Florida 


Direct 

Regional indirect 


10,600 
17,172 


1,200 
1,404 


Total 


27,772 


2,604 



1 Based on employment multipliers calculated by Florida State University. 
Sources: Florida State Department of Commerce and individual phosphate 
companies. 



11 





WAGES AND SALARIES BREAKDOWN: 
PHOSPHATE INDUSTRY 418.9 



WAGES AND SALARIES BREAKDOWN: 
PHOSPHATE INDUSTRY 40.7 



ALL OTHER INDUSTRIES 2,804.0 

TOTAL WAGES AND SALARIES 3,222.9 

Figure 3.— Total wages and salaries attributable to the 
phosphate industry in central Florida in 1977 (million 
dollars). 

dustries. The economic base model demonstrates this; com- 
parison of the estimated location quotients shows phosphate 
chemical and fertilizer mining and agricultural chemicals pro- 
duction to be the leading ITO industries in Polk and Hamilton 
Counties and agricultural chemicals production to be the sec- 
ond leading ITO industry in Hillsborough County. The phos- 
phate industry in Hamilton County, although small as a per- 
centage of statewide production, dominates the industrial sector 
of that county owing to the county's otherwise insignificant 
industrial base. 

Through the use of regional multipliers it was possible to 
estimate the direct and indirect impacts of the Florida phos- 



ALL OTHER INDUSTRIES 60.3 

TOTAL WAGES AND SALARIES 101.0 

Figure 4. — Total wages and salaries attributable to the 
phosphate industry in northern Florida in 1977 (million 
dollars). 

phate industry on both regions. Total 1977 wages and sal- 
aries of approximately $41 8.9 million were attributed to the 
phosphate industry in central Florida. In northern Florida, 
approximately $40.7 million in wages and salaries was gen- 
erated by the phosphate industry. These industry totals rep- 
resented an estimated 13 and 40 percent, respectively, of 
the two regions' total wages and salaries, as shown in figures 
3 and 4. The industry's regional employment shares were 
smaller, but nonetheless significant. Some 8 percent of the 
regional employment in central Florida and 21 .4 percent of 
northern Florida's regional employment was linked to the 
phosphate industry. 



12 



THE PHOSPHATE INDUSTRY: AN INDUSTRIAL COMPLEX APPROACH 



Location quotient theory and economic base analysis, com- 
mon techniques used in developing regional studies such as 
those in the preceding section, have some limitations in ad- 
dition to their many positive attributes. One limitation is that 
these techniques may overlook certain interrelationships, such 
as the possibility of interaction between regions. Therefore, 
an interregional input-output (l-O) approach was also used 
to study the Florida phosphate industry as an industrial com- 
plex. 

Of the general interdependence approaches available, the 
interregional l-O approach is most prominent in terms of ac- 
complishment and recognition. l-O analysis (also known as 
interindustry analysis) is a general technique that points up 
the complex interdependence of diverse business, consumer, 
political, and other cultural units of society. It uncovers to a 
significant degree the intricate structure of an economy, pro- 
viding a fertile forum for the display and scrutiny of the under- 
lying factors and processes that bind together the econom- 
ically multifaceted regions of the economic system. The strength 
of l-O analysis lies in its comprehensive representation of (1 ) 
the production and distribution characteristics of individual 
industries of different regions and (2) the interrelationships 
among these industries and between these industries and 
other economic sectors. It expresses, in essence, the basic 
fabric of an interindustry system as it exists not only within 
each region but also among regions. 

A more specific approach, the industrial complex tech- 
nique, can be integrated into general interdependence l-O 
analysis. An industrial complex may be defined as a set of 
activities occurring at a given location and belonging to a 
group (subsystem) of activities that are subject to important 
production, marketing, or other interrelationships. 

Most of the activities relevant to this analysis of the phos- 
phate industrial complex in Florida take place in the central 
Florida region, which includes the Tampa Bay area. A much 
smaller level of activity, which is nonetheless important to the 
complex, takes place in the northern Florida region and the 
Port of Jacksonville. Along with the estimated economic im- 
pacts that can be identified as direct results of the phosphate 
industry, other impacts can be approximated through the use 
of l-O analysis techniques. 

l-O analysis is used to study the interdependence of eco- 
nomic sectors. l-O models have been developed for the study 
of national as well as regional and State economies. For the 
analytical framework used in this report, a State l-O model 
was developed that permits measurement of the economic 
activity in the State of Florida with special emphasis on the 
phosphate industry. A Bureau of Mines l-O table of the Florida 
economy (17) was used to estimate phosphate industry mul- 
tipliers. This table included data compiled for 1972 for 338 
industrial sectors such as those listed in tables 3 and 4 of 
this report. 

The assumptions embodied in the analytical framework are 
briefly reviewed here, and a detailed methodology that de- 
scribes this framework is included in appendix A. First, an 
estimate of the Florida phosphate industry's annual produc- 
tion of major products was determined for 1981. From these 
estimates, the phosphate industry's employment, income, and 
value of output were estimated for 1981 , using 1977 dollars 
and assuming constant wages and productivity. Regional 
nultipliers were then applied to the employment and income 
sstimates to determine the industry's total economic impact, 



including direct, indirect, and induced effects (79). (Induced 
effects refers to the repercussionary effects of secondary 
rounds of spending or employment.) Multipliers were also 
applied to the value-of-output estimates in order to determine 
the direct and indirect effects of the industry's output, which 
together represent the industry's total statewide output value. 

The result is a projection of the phosphate industry as it 
might exist in 1 981 , based on growth rates estimated by the 
Bureau. In addition to the Florida phosphate industry's effects 
on that State's economy, the output, employment, and in- 
come effects of the Florida industry on the national economy 
were also identified. A national l-O model for 1972, which 
included data for 404 industrial sectors (28), was used for 
this purpose. 

The importance of the Florida phosphate industrial complex 
lies mainly in its backward and forward linkages. Backward 
linkages in the phosphate industry are those purchases of 
inputs by the phosphate industrial complex, such as pur- 
chases of goods and services, that are associated with the 
production of phosphate rock and derivative products. These 
purchases consist chiefly of basic materials and minerals; 
machinery, supplies, and parts; and labor resources. In this 
analysis, fiscal aspects of the industrial complex are also 
considered as part of the backward linkages. There is a sig- 
nificant amount of leakage from the State in terms of inputs 
necessary to run the complex. What this means is that a part 
of the inputs are purchased outside the limits of the industrial 
complex (meaning in this case outside the State of Florida). 

Forward linkages of the phosphate industrial complex are 
sales of intermediate products, in most cases to other in- 
dustries. These include sales of phosphate rock, agricultural 
chemicals, and industrial chemicals. Most of the industry's 
phosphate rock sales is for the domestic market outside Flor- 
ida, and the remainder is exported to foreign nations. Agri- 
cultural phosphate chemicals are sold mainly for use as fer- 
tilizers or as intermediates for processing into mixed fertil- 
izers, and small amounts are also sold as animal feed sup- 
plements. A small part of the sales of the Florida phosphate 
industrial complex is in the form of elemental phosphorus, 
which is used in detergents formulation, pharmaceuticals, 
and many other products. Most of the State's elemental phos- 
phorus that is used to produce industrial chemicals is mar- 
keted outside Florida. 



The Regional Impact 

Shipments of phosphate products through the Port of Tampa 
in 1 976 (table 1 1 ) accounted for 87 percent of the tonnage 
and 80 percent of the value of all phosphate product exports 
from the State of Florida. (These percentages were derived 
from data aggregated from country-by-country tabulations listed 
under Code Number 18 s of the U.S. Bureau of the Census, 
and a portion of these aggregated data is shown in table 1 1 .) 
The Port of Jacksonville accounted for 6.7 percent of the 
tonnage and 5.6 percent of the value of the State's phosphate 
product exports, and the Port of Boca Grande handled 3.3 



5 Code Number 18, a classification that includes virtually all Florida ports, is 
used by the U.S. Department of Commerce, Bureau of the Census, in the 
compilation of foreian trade statistics. 



Table 1 1 .—Exports of phosphate products 1 from Tampa 

(Metric tons and dollars) 



Product 



Florida phosphate rock and Florida land pebbles 

Diammonium phosphate _ 

Concentrated superphosphate _ 

Phosphoric acid, fertilizer grade _ 

Ammonium phosphate fertilizers 

Mixed chemical fertilizers, n.e.c. _ 

Phosphatic chemical fertilizers, n.e.c. 

Normal chemical enriched superphosphate 

Natural phosphate fertilizers 

Elemental phosphorus __ 

Dicalcium phosphate 

Phosphoric acid, n.e.c 



Total 



1976 



Quantity 



8,315,876 

1,519,183 

979,999 

221,549 

76,752 

7,669 

9,290 



109,225 

230 

36 





11,239.809 



Value 



281,279,207 

180,940,373 

91,129,080 

51,821,356 

9,335,077 

1,004,212 

1,395,700 



2,357,827 

324,865 

7,296 





619,594,993 



' Includes products listed under Code Number 1 8 of the Bureau of the Census. 
Source: U.S. Department of Commerce, Bureau of the Census, foreign trade statistics. 



1977 



Quantity 



12,228,868 

1,814,001 

957,926 

295,504 

139,113 

23,418 

13,426 

34,803 

37,126 

332 

2,196 

98 



15,546,811 



13 



Value 



316,450,764 

233,005,751 

90,837,793 

66,449,100 

16,379,997 

2,530,261 

2,004,361 

862,281 

840,321 

420,652 

338,172 

3,072 



730,122,525 



percent of the total tonnage and 7 percent of these exports 
in terms of value. Other Florida ports that exported phosphate 
products — although in relatively low volumes in terms of both 
tonnage and value — were Fernandina Beach, St. Petersburg, 
and Port Canaveral. 

The Florida Phosphate Council has estimated that the Flor- 
ida phosphate industry's expenditures for. water transporta- 
tion in 1977 amounted to $21.3 million, or 4 percent of the 
total value of the products shipped. These outlays were di- 
vided among barge and ocean traffic. 

In the next three subsections of this report, the effects of 
the phosphate industrial complex on Polk County are sum- 
marized; and the import-export and domestic shipping activ- 
ities are discussed, together with employment data, for the 
Ports of Tampa, Jacksonville, and Boca Grande. 

POLK COUNTY 

A large share of the activity of the Florida phosphate in- 
dustrial complex is centered in Polk County. In 1977, total 
employment in Polk County was greater than 98,000, and of 
this total, more than 8,600 workers were employed by the 



phosphate industry. These 8,600 employees earned more 
than $110 million in 1977. 6 The economic significance of the 
phosphate industry's work force has been shown to be much 
larger than is suggested by the industry's nominal 9 percent 
share of employment in Polk County. The phosphate industry 
has historically contributed property taxes equal to about 30 
percent of the total amount collected in Polk County. The tax 
base of the county government and the viability of the local 
economy both depend heavily on the phosphate industry. 

THE PORT OF TAMPA 7 

The Port of Tampa, which includes all deepwater facilities 
within the city of Tampa, is one of the 10 largest ports in the 
United States in terms of tonnage volume. In 1977 it handled 
more than 46 million metric tons of cargo, and of this tonnage, 
61 percent was products either sold or purchased by the 
Florida phosphate industrial complex (table 12). Phosphate 



6 Florida Department of Labor and Employment Security, Division of Employ- 

ment Security. 

7 See reference map in figure 1 . 



Table 12.— Inbound and outbound traffic through the Port of Tampa for selected commodities related to the 

phosphate industries, 1977 

(Metric tons) 





Total 


Foreign 


Domestic 


Barge shipments 


Commodities 


Imports 


Exports 


Inbound 


Outbound 


In 


Out 


Ammonia ._ 

Ammonium sulfate 

Fertilizer, bagged 

Fertilizer, materials 

Phosphate, bagged 

Phosphate, bulk 

Phosphatic chemicals, 

bagged 

Phosphatic chemicals, 

bulk 

Phosphoric acid 

Phosphorus 

Sulfur, liquid 

Sulfuric acid 


157,655 

23,847 

9,135 

41 ,400 

2,971 

18,032,144 

32,822 

3,520,487 

535,187 

248 

3,329,488 

32,643 


157,655 


21,083 





517 





744,577 

32,643 






7,629 

18 

2,971 

10,814,815 

32,807 

2,651,201 

535,187 

248 


















2,584,91 1 








165,618 



5,446 







23,847 


20,299 
















1,507 


7,051,711 

15 

863,323 






Total selected 

commodities 

Total shipments, 

Port of Tampa 


25,718,028 
42,020,357 


956,475 
4,323,903 


14,044,875 
15,022,596 


2,584,911 
6,289,958 


171,064 
171,064 


44,146 
8,262,322 


7,916,556 
7,950,514 



Source: Port of Tampa Authority. 



14 



Table 13.— Relative value and tonnage of various 
cargoes shipped through the Port of Tampa, 1977 



Type of cargo 


Percent of total 
dollar value shipped 


Percentage of 
total tonnage 


Phosphate products 

Petroleum products 

Other dry bulk 

Other liquid bulk 

General cargo 


34 

32 

5 

9 

20 


47 
29 
12 
10 
2 


Total 


100 


100 



products alone represented 47 percent of the total tonnage 
and 34 percent of the total value of shipments handled by 
the port in 1977 (table 13). 

The total economic impact of the port for 1 977 was esti- 
mated at more than $500 million. Of this total, approximately 
$200 million was estimated as the primary or direct impact, 
and $356 million was estimated as the indirect impact. About 
$77 million of the direct impact was attributed to the handling 
of phosphate products, and the remaining $123 million was 
made up of petroleum products, general cargo, and other 
bulk items (4). Direct employment related to the Port of Tampa 
in 1977 accounted for approximately 5,800 jobs, all but 20 
of which were full-time jobs. An additional 24,166 jobs have 
been identified as being indirectly related to the activities of 
the port, of which 21,276 were in the phosphate fertilizer 
sector (5). At an average income of $9,000 for each of these 
24,166 indirectly related jobs, the total indirect income impact 
of the port would have been approximately $217 million. 

Nearly $500 million in exports of phosphate products was 
directly handled by the Port of Tampa in 1976, and in 1977 
the value of such exports directly handled by the port in- 
creased to $580 million. If the value of all outbound phosphate 
products from the port were accounted for, including domestic 
shipments, the total value for 1977 would have been more 
than $600 million. 

Phosphate rock and related products accounted for more 
than 93 percent of all foreign exports that passed through 
the Port of Tampa in 1 977, and nearly all domestic outbound 
shipments that left the port by ship or barge were also phos- 
phate rock and/or related products (table 12). The largest cat- 
egory of shipments was bulk phosphate rock, of which more 
than 18 million metric tons was shipped. Of this total, about 
60 percent was exported to foreign countries and the rest 
barged or shipped to domestic ports. Major foreign con- 
sumers of bulk phosphate rock were Canada, the Republic 
of Korea, Japan, France, and the Federal Republic of Ger- 



Table 15. — Port of Jacksonville exports of selected 

commodities related to the phosphate industry, 

1970-76 

(Metric tons and dollars) 





Phosphate rock 


Phosphate fertilizers 


Year 


Quantity 


Value 


Quantity 


Value 


1976 
1975 
1974 
1973 

1972 
1971 
1970 


636,479 

719,155 

1,006,389 

1,117,539 

1,013,255 
936,629 
632,029 


22,056,763 

39,475,829 

23,333,669 

9,031 ,888 

7,989,651 
8,204,194 
5,580,361 


119,466 

136,431 

115,140 

89,001 

114,963 
134,805 
100,403 


12,754,563 

33,006,151 

24,759,103 

8,494,945 

8,234,520 
6,474,821 
3,860,181 



Source: Port of Tampa Authority. 

many; each of these countries purchased more than 1 million 
tons in 1978. 

Tampa shipments of phosphatic chemicals totaled more 
than 3.5 million metric tons in 1977, of which approximately 
75 percent was foreign exports. Exports of phosphatic chem- 
icals doubled in volume between 1970 and 1976, and the 
dollar value of these exports quadrupled during that period 
(table 14). Major foreign consumers of phosphatic chemicals 
were Brazil, India, Belgium, France, Italy, Turkey, Mainland 
China, and the Federal Republic of Germany. 

Sulfur (including sulfuric acid) and ammonia were the major 
input items — either as imports or inbound shipments from 
other domestic ports — to the Florida phosphate industrial 
complex via the Port of Tampa. Domestic ammonia and sulfur 
are acquired from the Gulf Coast area, mainly from Texas 
and Louisiana. Sulfur is also imported, mostly from Mexico, 
and ammonia is imported from the U.S.S.R. In addition, the 
complex is a major user of electricity and therefore an indirect 
user of petroleum products, which also pass through the Port 
of Tampa. As shown in table 12, exports amounted to almost 
80 percent of the total foreign trade in and out of the Port of 
Tampa in 1 977. This indicates that the port maintained a very 
favorable balance of trade, largely due to the impact of the 
phosphate industry. 

THE PORTS OF JACKSONVILLE AND BOCA 
GRANDE 8 

The Port of Jacksonville exports phosphate rock and phos- 
phatic fertilizers. In 1976 exports included about 636,479 metric 



1 See reference map in figure 1 . 



Table 14. — Port of Tampa imports and exports of selected commodities related to the phosphate industry, 1970-77 

(Thousand metric tons and thousand dollars) 





Imports 


Exports 




Ammonia 


Sulfur 


Phosphate, bulk 
and bagged 


Phosphatic chemicals 


Phosphoric acid 


Year 


Quantity 


Value 


Quantity 


Value 


Quantity 


Value 


Quantity 


Value 


Quantity 


Value 


1977 ... 
1976 .... 
1975 ... 
1974 ... 

1973 ... 
1972 ... 
1971 ... 
1970 ... 


158 

127 

140 

62 

83 
117 
140 
138 


NA 

NA 

11,943 

6,938 

3,758 
5,325 
6,615 
6,346 


745 
615 
632 
489 

50 

37 

107 

192 


NA 

NA 

34,961 

18,063 

1,251 

916 

2,623 

5,988 


10,818 
7,660 
8,470 

10,013 

9,495 

8,754 

8,337 

NA 


1 279,196 
258,206 
358,443 
194,728 

79,049 
77,266 
69,610 
64,908 


2,684 

2,159 

1,883 

942 

1,363 
1,129 
1,126 
1,090 


NA 
238,474 
389,387 
197,417 

118,381 
78,127 
59,515 
55,834 


535 
394 
222 
125 

37 

33 

115 

30 


NA 

NA 
42,684 
14,170 

2,962 
2,044 
4,755 
1,526 



NA Not available. 

1 Based on average export price for 1977. 

Source: Port of Tampa Authority. 



15 



Table 16.— Port of Boca Grande exports of selected 

commodities related to the phosphate industry, 

1970-76 

(Metric tons and dollars) 





Phosphate rock 


Phosphate fertilizers 


Year 


Quantity 


Value 


Quantity 


Value 


1976 
1975 
1974 
1973 

1972 
1971 

1970 


107,335 
68,555 
97,978 

307,505 

193,071 
376,217 
434,756 


3,892,500 
2,714,584 
2,530,572 
3,564,388 

1,671,455 
2,929,789 
3,492,766 


261 ,632 
213,231 
431,485 
512,491 

356,839 
262,688 

169,145 


39,104,937 
39,248,688 
84,812,442 
45,211,667 

20,239,702 

13,361,024 

8,096,090 



Source: Port of Tampa Authority. 



tons of phosphatic rock and 1 1 9,466 metric tons of phosphatic 
fertilizer products. Although the dollar value of phosphate rock 
exports more than doubled between 1973 and 1976, the total 
tonnage dropped in that period by 43 percent (table 15). In 
that same period there was a 34-percent increase in the 
tonnage of phosphatic fertilizer, and the value of such ship- 
ments increased at about twice that rate, or 67 percent. Phos- 
phate product prices, which had risen sharply in 1974 and 
1975, showed signs of leveling off in 1976 and 1977. 

Export tonnages of phosphate rock from the Port of Boca 
Grande have declined; these exports totaled 107,355 metric 
tons in 1976. The value of phosphate rock exports, however, 
has increased. Exports of phosphate fertilizers from Boca 
Grande have declined in recent years, from a peak of 51 2,491 
metric tons in 1 973 to 261 ,632 metric tons in 1 976 (table 1 6). 



Rail and Motor Carrier Transportation 

RAIL SHIPMENTS 

Railroads are the primary means used for shipping large- 
volume movements of phosphate rock from beneficiation plants 
to shipping ports and to fertilizer processing facilities. These 
movements, particularly in the central Florida phosphate re- 
gion, are very heavy, with some beneficiation plants shipping 
as many as 1 50 cars, or 1 0,000 tons of phosphate rock, each 
day (7). In the central Florida region, multiple-car shipments 
from several origins are assembled into trains for movement 
to various destinations within the region, including the Tampa 
Bay area, or to switching yards for through movement to more 
distant destinations. 

Table 17 lists the tonnages, modes of transportation used 
by selected Florida industries for shipping goods to other 
regions of the United States, and the percentage distribution 
of traffic in various products among these modes. In this table, 
phosphate products are included in the agricultural chemicals 
and superphosphates categories. Shipments of agricultural 
chemicals from Florida represented 22 percent of all the ton- 
nage shipped from the State. Almost all of these shipments 
originated in the phosphatic fertilizers subindustry of the Flor- 
ida phosphate industry. 

Table 18 shows the geographical distribution of various 
kinds of agricultural chemicals that were produced in Florida 
and shipped to other parts of the United States. Based on a 
sample of waybill data compiled by the U.S. Bureau of the 
Census, this table indicates that 74 percent of the fertilizer 
subindustry's shipments went to the South Atlantic region. 
Most of the shipments recorded for this region were within 



Table 17.— Tonnages and means of transportation for selected manufactured goods shipped form Florida to the 

rest of the United States, 1972 



Product 



TCC 



Quantity 

shipped, 

thousand 

metric 

tons 



Relative share of total shipments, percent 



Rail 



Truck 
carrier 



Private 
trucks 



Air 



Water 



Other 



Unknown 



Sampling 

variability, 

percent 



Chemicals and allied products _ 

Food and kindred products 

Stone, clay, glass, and concrete products __ 

Pulp, paper, and allied products 

Lumber and wood products, except furniture 
Fabricated metal products, except ordinance, 

machines, and transportation 

Transportation equipment 

Electrical machines, equipment, and 

supplies 

Tobacco products 

All other miscellaneous 

Total 



28 
20 
32 
26 

24 

34 
37 

36 
21 
NAp 



8,016 
6,029 
5,354 
2,796 
914 

283 

30 

8 

7 
3,079 



76.0 
31.6 
44.8 
79.8 
48.5 

8.7 
.6 

.3 

3.6 

44.6 



6.4 
24.0 
43.3 
16.0 

5.2 

28.3 
34.1 

52.4 
90.2 
20.8 



17.3 
41.4 
11.8 
3.7 
45.8 

60.6 
64.6 

4.9 

1.7 

29.9 



0.5 






.4 

7.8 
2.1 

.5 




2.1 

.5 


2.3 


8.1 



4.0 



0.3 
.2 




.2 
.4 

23.9 
1.0 

.4 



Chemicals and allied products, selected 
sub-categories: 2 

Agricultural chemicals 

Superphosphates 

Industrial inorganic and organic chemicals . 
Miscellaneous industrial inorganic chemicals 

Sulfuric acid _ 

Miscellaneous chemical products 



NAp 



287 

28712 

281 

2819 

28193 

289 



26,515 



5,924 
4,271 
1,433 
1,301 
129 
15 



54.6 



80.9 
96.8 
80.4 
86.1 
68.5 
7.7 



20.8 



2.6 
.4 
13.0 
10.4 
18.6 
77.3 



23.2 



165 
2.8 
5.8 
2.7 
9.9 
4.6 








10.4 



1.0 



.2 





.4 
.4 
3.2 
.1 



0.2 

1.0 

.3 

.2 

.7 


.2 

3.0 

3.4 

.2 



24 
22 
29 
11 
42 

33 
40 

47 
11 




12 



30 
37 
20 
22 
25 
40 



NAp Not applicable. 

1 Transportation Commodity Code used in Census of Transportation, 1972, a publication of the U.S. Department of Commerce, Bureau of the Census. 

2 The sum of the quantities shipped for these subcategories is greater than the quantity shipped of chemicals and allied products because some products are 

included in more than one of these subcategories. 
Source: U.S. Department of Commerce, Bureau of the Census (29). 



16 



Table 18. — Tonnages and distribution of chemical and allied products manufactured in Florida and shipped to the 

rest of the United States, by region, 1 1972 





TCC 2 


Total 
shipments, 
thousand 
metric tons 


Distribution by region, 3 percent 


Product 


Mid- 
Atlantic 


East 
North 
Central 


West 
North 
Central 


South 
Atlantic 


East 
South 
Central 


West 
South 
Central 


Chemical and Allied products 

Agricultural chemicals 

Superphosphates 

Industrial inorganic and organic 
chemicals 

Miscellaneous industrial and in- 
organic chemicals 

Sulfuric acid 

Miscellaneous chemical products . 


28 

287 

28712 

281 

2819 

28193 

289 


8,007 
5,554 
3,915 

1,429 

1,301 

86 

8 


2.0 




( 4 ) 

( 4 ) 
( 4 ) 
( 4 ) 


12.4 
12.8 
16.1 

17.5 

19.0 

( 4 ) 

25.0 


7.0 
8.9 
6.9 

4.3 

4.7 

( 4 ) 

38.0 


64.9 
74.6 
72.8 

46.6 

44.3 

100.0 

25.0 


9.1 

( 4 ) 
( 4 ) 

25.4 

26.1 

( 4 ) 
12.0 


3.9 

3.7 
4.2 

5.8 

5.9 

( 4 ) 
( 4 ) 



1 U.S. Department of Commerce, Bureau of the Census regions (29). 

2 Transportation Commodity Code used in Census of Transportation, 1972, a publication of the U.S. Department of Commerce, Bureau of the Census. 

3 Shipments to the New England, Mountain, and Pacific Regions amounted to less than 1 percent of the total shipments for each of the product categories listed. 

4 Less than 1 percent of total shipments. 



Florida and were shipped through the Port of Tampa. 

Of the phosphate rock produced by the industry's mining 
sector, 85 percent was shipped by rail, to points both within 
and outside the State (table 19). Some phosphate rock was 
also shipped by rail-barge combination to other parts of the 
United States, and some was exported. Approximately $54 
million in revenue to railroads was generated by phosphate 
rock traffic in 1976, and the railroads' phosphate revenues 
for 1 977 were estimated at $65 million. These estimates were 
based on statistics for the Southern District; 9 however, almost 
all phosphate rock mining in this district took place in Florida. 

Total railroad revenue attributed to the industry for all 
movement of phosphate rock, phosphate fertilizers, and re- 
lated commodities amounted to $71 million in 1976 and $86 
million in 1977, according to the Florida Phosphate Council. 
Almost all of the $86 million spent in 1 977 was directly related 
to the operations of Seaboard Coast Line Industries, Inc. 
(SCL), and its subsidiaries in Florida. SCL attributed more 
than 13 percent, or $229 million, of its total 1977 transpor- 
tation revenues of $1 ,678.7 million to its Florida operations. 
Phosphate industry shipments, including some 19.5 million 
metric tons of phosphate rock shipped to the Port of Tampa 
from the central Florida region, represented approximately 
37 percent of SCL's total transportation revenues in the State 
of Florida that year. 

TRUCK SHIPMENTS 

Truck movement of phosphate rock is used to supplement 
rail movement during periods of peak production in the central 



Florida region. Trucks are used as a temporary replacement 
for rail transportation when rail service is interrupted and as 
a primary means of transportation where low shipping vol- 
umes make rail transport impractical. Almost all truck traffic 
related to the Florida phosphate industrial complex involves 
movements of phosphate rock, molten sulfur, and fertilizer 
between the Port of Tampa and mines and chemical facilities 
located in Polk County. The Florida Phosphate Council es- 
timated that expenditures for truck transportation amounted 
to $6.9 million in 1976 and $9.3 million in 1977. 



Electric Utilities 



The electric utility industry in Florida receives significant 
revenues from the phosphate industry. Members of the Flor- 
ida Phosphate Council remitted more than $120 million to the 
electric power utilities in 1977. Electric power is used by the 
phosphate industry for mining, for the operation of processing 
facilities, and for other purposes. 

Phosphate industry payments to Tampa Electric Co. in 
1977 exceeded $79 million, which was 23 percent of the 
company's total revenue and 74 percent of its industrial rev- 
enue. In the same year Florida Power Corp. received reve- 
nues of $41 million from the phosphate industry, which rep- 



9 The Southern District as designated by the Interstate Commerce Commission 
includes Florida, Tennessee, North Carolina, South Carolina, Georgia, Al- 
abama, Mississippi, southeastern Louisiana, and Kentucky. 



Table 19. — Transportation means used for shipments of Florida and North Carolina phosphate rock, by 

destination, 1976 

(Thousand metric tons) 





Destination 1 


Means of 
transportation 


Florida 


Alabama, 

Arkansas, 

North Carolina, 

Tennessee 


Illinois, 

Iowa, Kansas, 

Michigan, 

Missouri 


Louisiana, 

Mississippi, 

Texas 


California 

and 
Arizona 


Export 
shipments 


Rail 

Truck 

Barge 

Conveyor 

Rail and barge 
Truck and rail 


13,452 
1,049 

O 
1,179 

( 2 ) 
( 2 ) 


1,559 
( 2 ) 
( 2 ) 
( 2 ) 
( 2 ) 
( 2 ) 


65 

( 2 ) 
( 2 ) 
( 2 ) 
( 2 ) 

( 2 ) 


5 
( 2 ) 
( 2 ) 
( 2 ) 
6,573 
45 


39 
( 2 ) 
( 2 ) 
( 2 ) 
( 2 ) 
( 2 ) 


363 

( 2 ) 

3,357 

( 2 ) 
10,324 

( 2 ) 



1 Shipments to Idaho, Montana, and Utah amounted to less than 1,000. metric tons for each of the transportation categories listed. 

2 Less than 1 ,000 metric tons. 



17 



Table 20.— Average cost of electric power in Florida for 
selected industrial uses 

(Cents per kilowatt-hour) 



Table 21 .—Selected taxes paid or collected by the 
Florida phospr ite industry complex 

(Thousands) 





Utility 


Use 


Tampa 
Electric Co. 


Florida 
Power Corp. 


Mining: 

1976 


2.399 
2.542 

1.199 
1.222 

2.154 
2.287 


2 672 


1977 


2.987 


Chemical plants: 

1976 


2 270 


1977 _ 


2.566 


Electric furnaces: 

1976 


NAp 
NAp 


1977 





NAp Not applicable. 

resented 7 percent of that company's total revenue and 53 
percent of its industrial revenue. Florida Power and Light also 
serves the phosphate industry. In 1977 approximately 64 
percent of the electrical power consumed by the phosphate 
industry was purchased from Tampa Electric, 35 percent from 
Florida Power, and 1 percent from Florida Power and Light. 

Industrial costs for electric power for selected phosphate- 
related uses are shown in table 20. 

A review of electric energy costs to the Florida phosphate 
industry from 1968 to 1977 showed that the cost of electric 
energy sold by Florida Power to the mining industry increased 
by 237 percent during that period. The cost per kilowatt-hour 
was 0.888 cent in 1968 and had risen by 1977 to 2.99 cents 
per kilowatt-hour. The largest increase — an increase of more 
than 100 percent during a 1-year period — was from 1973 to 
1974, when the cost of electric energy increased from 1.1 
cents per kilowatt-hour to 2.08 cents per kilowatt-hour. 

The following tabulation, which shows how a Florida elec- 
tric company typically spends its revenue, is an example of 
a forward linkage of the phosphate industry. In this tabulation, 
the more than $41 million paid to Florida Power by the phos- 
phate industry is broken down, based on the power com- 
pany's average revenue dollar of expenditures for 1977. 

Percent 

Fuel and purchased power 41.5 

Interest and other income deductions 7.7 

Federal, State, and local taxes 17.8 

Dividends 7.1 

Payroll and employee benefits 7.4 

Provision for property replacement 8.2 

Materials, supplies, and other expenses .... 4.9 
Retained in the business 5.4 

Total 100.0 

Expenditures from revenues could be similarly broken down 
for Tampa Electric. 

State and County Tax Revenues 

The phosphate complex is a major generator of tax revenue 
for the State of Florida. State taxes paid by the industry in- 
clude the severance tax on minerals, the corporate income 
tax, the sales and use tax, and vehicle and motor fuel taxes. 
The industry is also a source of county-level tax revenue in 
the form of property taxes. The State sales and use tax is 
an important source of revenue because of the complex pur- 







State 


State 






Ad valorem 


sales and 


corporate 




Fiscal 


county-level 


use tax 


income tax 


Severance 


year 


tax paid 


collected 


paid 


tax paid 1 


1977-78 


$12,500 


$13,800 


NA 


2 $41 ,600 


1976-77 


9,500 


12,850 


$2,459 


22,056 


1975-76 


6,700 


13,800 


3,270 


22,322 


1974-75 


5,800 


8,200 


5,460 


10,838 


1973-74 


NA 


NA 


1,712 


4,047 


1972-73 


NA 


NA 


NA 


3,268 


1971-72 


NA 


NA 


NA 


1,509 



NA Not available. 

1 For fiscal years 1971-76, a total of $5,187,000 was returned to the industry 

in the form of a severance tax credit based on the amount of ad valorem 
tax paid. (Conditions with respect to land reclamation were also a con- 
sideration in the application of this credit.) The credit amounted to about 
9 percent of total severance tax collections. 

2 Estimated by Finance, Taxation, and Claims Committee of the Florida Senate, 

based on value at point of severance of $1 1 .57 per metric ton. 
Sources: Florida Phosphate Council and Florida State Department of Revenue. 



chases of raw materials and constituent parts by the phos- 
phate industry. Also important to the State are sales taxes 
collected by the industry on sales of phosphate rock, phos- 
phate agricultural chemicals, and industrial chemicals sold to 
other industries. Table 21 presents a summary of taxes paid 
by the phosphate complex to State and local governments 
from fiscal year 1971-72 to fiscal year 1977-78. In the fol- 
lowing tabulation, State and county tax revenues from phos- 
phate industry activities are estimated for 1981, in million 
1977 dollars: 

State corporate income taxes 5.8 

State sales and use taxes 25.0 

State vehicle and motor fuel taxes .3 

State severence taxes on minerals 48.5 

All property taxes paid to counties 20.0 

Total projected Florida tax payments 99.6 

CORPORATE INCOME TAXES 

Florida has had a corporate income tax since January 1 , 
1972. This tax is collected from all corporations, both do- 
mestic and foreign, doing business in Florida. The tax rate 
is 5 percent of the adjusted Federal corporate income tax 
owed by the firm, less a $5,900 exemption. Since the tax was 
instituted, the phosphate industry in Florida has paid the fol- 
lowing amounts each year in corporate income taxes, ac- 
cording to the Florida Department of Revenue: 

1973 $1,712,150 

1974 5,460,341 

1975 3,269,859 

1976 2,459,228 

1977 NA 

1981 e 3,500,000 

8 Estimated. NA Not available. 

The total for 1974 was unusually large because it included 
taxes assessed in 1973 but not paid until 1974. In addition 
to the 1981 estimate of $3.5 million in corporate income tax 
payments by the phosphate industry, it was projected that 
other industries would pay $2.3 million in corporate income 
taxes attributable to phosphate industry activity. The effect 



18 



of the phosphate industry's activities on other industries is 
described later with respect to output in the subsection, "Output 
Effect." 

SALES AND USE TAXES 

The Florida sales and use tax is the State's primary source 
of revenue. The tax rate is 4 percent of final sales, but there 
are many general and specific exemptions. In 1977 the phos- 
phate complex paid more than $14 million in Florida sales 
taxes, and it is expected to pay an estimated $15.7 million 
in 1981. Based on this estimate, total State sales tax reve- 
nues attributable to phosphate-related output are expected 
to exceed $25 million in 1981. Fertilizers and animal feeds, 
which constitute an important part of the phosphate industry's 
total sales, are exempt from the sales tax. Without this ex- 
emption, phosphate-related sales tax revenues would be much 
larger. 

VEHICLE AND MOTOR FUELS TAXES 

The Florida Phosphate Council reported that its members 
paid $192,000 in State vehicle and fuel taxes in 1977; how- 
ever, the total tax paid as a direct result of industry-related 
activity was much larger. Vehicle and motor fuel taxes paid 
by other firms and industries as a direct result of phosphate 
industry activity were estimated based on interindustry de- 
pendency coefficients calculated from an l-O table. Based on 
these estimates, it was estimated that in 1981 more than 
$300,000 in State vehicle and motor fuel taxes would be 
attributable to activity related to the phosphate industry. This 
forecast was based on a fiscal impact or revenue multiplier 
that is analogous to the output multipliers subsequently de- 
scribed under the subheading, "Output Effect." The revenue 
multiplier was calculated from estimates of revenue gener- 
ated through the backward linkage for the support of materials 
to the production process. 

SEVERANCE TAXES 

The State's solid minerals severance tax has been in effect 
since July 1, 1971, when the tax rate was set at 3 percent. 
The tax rate is applied to a value set by the State for phos- 
phate rock at the point of severance. State law originally 
provided for a gradual increase in the tax rate, and the rate 
was raised to 4 percent beginning July 1, 1973, and was 



subsequently raised to 5 percent beginning July 1, 1975. In 
1977 a Phosphate Land Reclamation Study Commission was 
created to examine the land reclamation practices of the State's 
phosphate rock mining operations, and the commission's most 
important recommendations were published as a report (14). 
As a result of this study, the severance tax rate on phosphate 
rock was increased in 1 978 from 5 to 1 percent. Tax pay- 
ments beginning with the 1978 tax year were to be made 
quarterly; previously, the tax was paid in a single annual 
payment that was due April 1 . The value set by the State for 
computation of the severance tax on phosphate rock may 
vary from year to year. This value increased to $12.84 per 
metric ton in 1977 from the previous value of $10.50 per 
metric ton. 

Severance tax collection's from the phosphate industry are 
shown in the following tabulation, in million dollars: 

1973-74 3.4 

1974-75 9.6 

1975-76 20.1 

1976-77 20.0 

1977-78 M1.6 

1978-79 1 42.2 

1979-80 2 48.5 

'Estimated by the Finance Taxation and Claims Committee of the 
Florida Senate, based on the pre- 1978 point-ot-severance value 
of $10.50 per ton. 

Estimated by the Bureau of Mines. 

A tax credit is available to the mining industry for the re- 
clamation of mined land. Land reclamation has been man- 
datory since 1 975, when a prior distinction between "old lands" 
(lands mined or disturbed by the severance of phosphate 
prior to July 1, 1975) and "new lands" was eliminated. The 
tax credit program requires producers to develop programs 
of reclamation and restoration that must be approved by the 
Florida Department of Natural Resources. 

Under the tax credit program, producers are allowed to 
credit up to 20 percent of ad valorem taxes against the sev- 
erance tax, except that the credit may not exceed the total 
amount of ad valorem taxes remitted on a specific parcel of 
mining property. Of the total phosphate severance tax, 75 
percent goes to the Land Reclamation Trust Fund, and 25 
percent goes to the State's General Revenue Fund. Refunds 
of up to 100 percent of the amount paid to the reclamation 
trust fund are allowed for approved plans for mine site recla- 
mation. 



Table 22. — Florida acreage distributed by phosphate mining and acreage in various stages of reclamation, 1976 





Acreage included in reclamation programs 


Acres disturbed 

by mining, 

1976 




Producer 


Reclamation 

in progress, 

1976 


Reclamation 

completed, 

1976 


Total reclamation 

completed, 
July 1, 1971 to 
Dec. 31, 1976 


Acres disturbed 

by mining, 
July 1, 1975, to 
Dec. 31, 1976 


Agrico Chemical Co. 


2,082 
737 

1,084 
327 

1,978 
698 
431 
529 
27 
358 
188 


872 
465 
838 

80 
1,301 

10 
374 
106 

158 
102 


2,178 
964 
929 
325 

3,194 
768 
483 
449 

280 

1,165 


1,430 
176 
375 
278 

1,278 
627 
782 
376 
37 
274 
255 


2,185 


Borden Chemical Co. 


275 


Brewster Phosphate Co 


680 


Gardinier, Inc. 

International Minerals & Chemical Co. 
Mobil Chemical Co. 


400 

1,932 

901 


Occidental Agricultural Chemical Co. 

Swift Chemical Co. 


1,075 
549 


T.A. Minerals Corp. 

U.S.S. Agri-Chemicals, Inc. 


37 
423 


W. R. Grace & Co. 


425 






Total 


8,439 


4.306 


10,735 


5,888 


8,882 



Source: Florida Department of Natural Resources, Division of Resource Management, Bureau of Geology. 



19 



Table 23.— Selected millage rates for the Florida ad 
valorem tax, 1976 



County 

Polk 

Hillsborough 
Hamilton .. 
Columbia __ 
Manatee ... 

Hardee 

Pasco 

Hernando . 

Citrus 

Levy _ 

Marion 

Gilchrist 

Alachu 

Putnam 

Lafayette ... 
Pinellas .... 
DeSoto 



County rate 



5.5390 
6.0470 
6.0290 
6.6920 
7.0580 
4.6620 
7.6450 
6.0760 
8.1240 
7.1000 
3.1800 
5.9146 
7.1931 
9.2600 
3.0000 
5.5400 
7.9020 



Schools rate 



8.0000 
8.0000 
8.0000 
7.6970 
8.0000 
6.3000 
8.0000 
8.0000 
8.0000 
7.8140 
8.0000 
6.3000 
8.0000 
7.4000 
6.3000 
8.0000 
8.0000 



Total 



13.5390 
14.0470 
14.0290 
14.3890 
15.0580 
10.9620 
15.6450 
14.0760 
16.1240 
14.9140 
11.1800 
12.2146 
15.1931 
16.6600 
9.3000 
13.5400 
15.9020 



The tax credit for land reclamation can be accumulated 
over time, but after 5 years, unclaimed reclamation funds 
revert to the General Revenue Fund. Since the inception of 
the severance tax, the phosphate industry has paid more 
than $100 million in severance tax payments. Of this total, 
more than $24 million has been refunded to mining compa- 
nies for the completion of reclamation projects. A summary 
of recent reclamation activity is presented in table 22. 

AD VALOREM PROPERTY TAXES 

According to the Florida Phosphate Council, members paid 
a total of $12.5 million in property taxes in 1977. Most of 
these taxes were paid to county and local governments in 
the central Florida region. In table 23, the ad valorem tax 
millage rates are listed for selected counties. It was estimated 
that the phosphate industry will pay more than $20 million in 
property taxes in 1981. 



Output Effect 



Marketable production of phosphate rock in Florida ex- 
ceeded 40 million metric tons in 1978. Based on an estimated 
production of 43 million metric tons in 1981 for Florida alone, 
it was projected that the direct output (sales) by the Florida 



phosphate industry for that year would total approximately 
$870 million, in 1 977 constant dollars. This projection of direct 
output included $303 million for phosphate rock shipped di- 
rectly out of the region to foreign countries or domestic con- 
sumers and $567 million for phosphate fertilizer processed 
in the State from Florida phosphate rock. 

The total effect of phosphate production, however, is much 
larger than $870 million. An additional output effect of the 
industry is in the form of sales of goods and services by 
second-level suppliers to the phosphate industry. Further- 
more, phosphate industry activity generates sales by third- 
level suppliers to the second-level suppliers. Added together, 
the industry-related sales of the second- and third-level sup- 
pliers constitute an indirect output effect of the phosphate 
industry which can in turn be added to the direct output. 
Succeeding levels of suppliers can also be included, but their 
contribution to the total output effect becomes less and less 
significant. 

The output multipliers for the phosphate industry measure 
the sum of direct and indirect requirements from all economic 
sectors needed to deliver one additional dollar of output from 
the phosphate industry to final demand (the consumer). These 
multipliers were derived from a Leontief inverse matrix 10 which 
showed the direct and indirect requirements per unit (dollar) 
of final demand for each sector. To obtain the output multi- 
pliers, phosphate industry data from the matrix were totaled. 
The total multiplier for Florida phosphate rock mining and 
beneficiation was estimated to be 1 .5440, and the multiplier 
for Florida fertilizer manufacturing was estimated to be 1 .5738. 
The magnitude of the Florida phosphate industry's output 
effect is apparent from the $1 .4 billion that was estimated as 
the industry's total combined output effect for 1981. 



Employment Effect 



Phosphate industry employees are among the highest paid 
industrial workers in central Florida; they are also among the 
highest paid workers in the State. Of all manufacturing em- 
ployees in Polk County, phosphate industry employees earn 
the highest hourly wage and work the lowest number of hours 
per week. Similarly, in northern Florida, the highest labor 



10 The Leontief inverse matrix was derived from a direct requirements l-O table 
prepared for the State of Florida. 



Table 24, 



-Comparison of labor force, earnings, and hours worked for selected industries in Polk County and the 

State of Florida, 1977 



Industry 


Annual 
labor force e 


Annual wages 1 


Hours worked 
per week 1 


Hourly earnings 1 


Polk County: 

Phosphate rock mining and 
beneficiation 


4,487 

4,131 

5,299 

19,100 

5,190 

8,592 

13,783 

374,600 


$13,476 

12,789 

8,586 

10,765 

13,476 

13,699 

9,030 

9,799 


44.3 
44.8 
48.0 
45.1 

44.3 
45.5 
45.7 
40.7 


$5.85 


Phosphate fertilizer manufacturing 

Citrus food products 


5.49 
3.44 


All manufacturing 

State of Florida: 

Phosphate rock mining and 

beneficiation 

Phosphate fertilizer manufacturing 

Citrus food products 


4.59 

5.85 
5.79 
3.80 


All manufacturing 


4.63 



6 Estimated. 

1 Average. 

Source: Florida Department of Commerce, Division of Employment Security. 



20 

Table 25.— Effect of Florida phosphate industry output, employment, and income on the on the State of Florida, as 

projected for 1981 





Phosphate rock 
mining and 
beneficiation 


Phosphate 

fertilizer 

production 


Industrial 
inorganic 
chemicals 1 


Combined impact 


Output effect, million 1977 dollars: 

Direct 

Indirect 


303 
165 


567 
325 






870 
490 


Total 


468 


892 





1,360 


Employment effect, number of jobs: 

Direct 

Indirect 

Induced 


7,030 

6,214 

16,343 


5,147 
3,812 
8,375 


377 
305 
896 


2 1 2,554 
10,331 
25,614 


Total 


29,587 


17,334 


1,578 


48,499 


Income effect, million 1977 dollars: 

Direct 

Indirect 

Induced 


93.7 
50.7 
92.3 


68.6 
52.9 
77.5 


5.0 
2.2 
4.6 


3 167.3 
105.8 
174.4 


Total 


236.7 


199.0 


11.8 


447.5 



1 Primarily elemental phosphorus. 

2 Based on a projected of 43 metric tons in 1981 and the assumption that an average of 291 .92 workers will be required per million tons of output. 

3 Based on the assumption that a total of 12,554 employees will be working in the industries listed above in 1981, at an average of $13,329 per year. 



wage is earned by workers at the Hamilton County phosphate 
operations of the Occidental Agricultural Chemical Co. 

The importance of phosphate industry employment to the 
central Florida regional economy is illustrated in table 24, 
which shows how wage and employment levels in the phos- 
phate industry compare with those of selected other indus- 
tries. This table also shows how Polk County wage and em- 
ployment levels compare with those of the State as a whole 
for these industries. 

In addition to the high rate of pay they earn, phosphate 
industry employees work steadily the year round with little or 
no layoff time, whereas employment in the citrus food prod- 
ucts industry, for example, is seasonal. The steady flow of 
wages and salaries generated by the phosphate industry helps 
provide a stable economy in central Florida. 

Table 25 shows estimated employment for 1981 for phos- 
phate rock mining and beneficiation, phosphate fertilizer pro- 
duction and inorganic industrial chemicals production in the 
State of Florida. As shown in this table, it was estimated that 
12,554 workers will be directly employed in the Florida phos- 
phate industry in 1981 (based on a projected output of 43 
million metric tons of phosphate rock). The total number of 
jobs expected to be impacted by the production of Florida 
phosphate products in 1981 was estimated at more than 
48,000. This total includes workers who are directly employed 
by the industry as well as those whose jobs are either indi- 
rectly related to the phosphate industry or induced by phos- 
phate industry activity. (Induced employment includes any 
jobs that support primary and secondary employment, such 
as retail and service employment.) 

INCOME EFFECT 

Table 25 shows that the total income effect expected to be 
generated by the Florida phosphate industry in 1981 was 
estimated at $447.5 million. 7ofa/ income effect refers to the 
sum of direct, indirect, and induced income; induced income 
is all tertiary and subsequent income generated. Of the total 



income effect estimated for 1981, direct and indirect income 
totaling $273.1 million was included in an estimate of the 
industry's total 1981 output effect. This estimate of the in- 
dustry's output effect, $1 ,360 million, is also shown in table 
25. The remainder of the total income effect, $174.4 million, 
is induced income. The total income effect was calculated 
based on a fype // multiplier, which is the ratio of the direct, 
indirect, and induced income change to the direct income 
change when final demand is increased by one unit. A more 
detailed explanation of type II multipliers is given in appendix 
A. 



Table 26.— Distribution of operating costs 1 in the 
Florida phosphate industry, 1977 

(Thousands) 



Expenditure item 


Within-Florida 
costs 


Total costs, 

including 

out-of-State 


Trucking 

Railroad transportation 

New construction 


$9,300.0 
86,000.0 
2 1 26,000.0 
120,200.0 
13,800.0 
21,000.0 

309,000.0 

12,500.0 

1 ,800.0 

192.0 

3 1 64,000.0 

42,400.0 

13,200.0 


$9,300.0 

86,000.0 

2 1 63 000 


Electric power 

Sales taxes 


120.200.0 
13 800 


Shipping firms, barges, etc .. 
Equipment, supplies (including 

raw materials), and 

services 

Property taxes, county 

Telephone service 


2l!oOO.O 

612,000.0 

12,500.0 

1 800 


Vehicle fuel tax, State 

Payroll 

Severance tax, State 

Natural gas distribution 


192.0 

3 1 64,000.0 

42,400.0 

13,200.0 


Total 


919,392.0 


1,259,392.0 



1 Estimated. 

2 These figures may include capital outlay misidentified as new construction; 

this could not be determined. 

3 Assuming that total payroll was expended in Florida. 
Source: Florida Phosphate Council. 



21 



Table 27. — Estimated operating costs and capital 
expenditures for the Florida phosphate industry, 1978 

(Million 1977 dollars) 



Industry 


Operating 
costs 


Capital 
expenditures 


Phosphate rock mining and beneficiation _ 
Phosphate fertilizer manufacturing: 

Phosphate acid, wet process 

Ammonium phosphate 


490.0 

687.0 
250.3 
148.5 


421.3 

463.3 
63.6 


Concentration superphosphate 


95.8 


Total _ 


1,575.8 


1 ,044.0 



at more than $1.0 billion, represents almost two-thirds of 
estimated total operating costs. 

Because of concern for the environment and the cost of 
compliance with new environmental laws, the U.S. Bureau 
of the Census has identified pollution abatement costs and 
capital expenditures for the major manufacturing industries, 
including those of the Florida phosphate fertilizer processing 
subindustry. Of the two totals shown in table 27, $14.1 million 
in capital expenditures and $20.9 million in total operating 
costs were identified as pollution abatement costs and ex- 
penditures for the phosphate fertilizer processing part of the 
industry (30). 



CAPITAL EXPENDITURES AND OPERATING 
COSTS 

Phosphate industry expenditures are estimated by item for 
1977 in table 26. This item-by-item expenditure-allocation 
table shows fairly accurately the distribution of operating costs 
for the industry. (It is possible, however, that certain capital 
outlays may have been misidentified and included in this table 
as expenditures for new construction; but this could not be 
determined.) 

Estimates of total operating costs and capital expenditures 
for the Florida phosphate industry in 1978 are given in table 
27. The value of replacement capital expenditures, estimated 



Summary 



The Florida phosphate industrial complex is forecast to 
produce the following value of output in 1981 and provide 
the following employment, income, and revenue benefits to 
Florida (directly, indirectly, or by induced effects): 

Total output $1,360 million 

Total employment 48,499 jobs 

Total personal income 1 $447.5 million 

Total tax revenue $99.6 million 

1 Of this amount, $273. 1 million is also included in the $1 ,360 million 
total output figure. 



22 



NATIONAL SIGNIFICANCE OF THE FLORIDA PHOSPHATE INDUSTRY 



Domestic Profile 



The central Florida phosphate district is the largest phos- 
phate producing region in the world. In 1978 domestic pro- 
duction of marketable phosphate rock reached a recond high 
of 50 million metric tons, of which approximately 40 million 
metric tons was from Florida. Based on projected production 
levels, it is expected that the central Florida phosphate district 
will continue to be a significant source of phosphate rock for 
the foreseeable future. If recent projections prove correct, 
however, production in central Florida will decline after 1987. 
Also, if certain economic conditions change, the life expect- 
ancy of the district's reserves would be expected to change 
accordingly. 

Most of Florida's phosphate rock production comes from 
the Bone Valley Formation in Polk and Hillsborough Counties. 
This formation is unique and has been a principal world source 
of phosphate rock. From a cost-of-production point of view, 
it is far superior to any other known foreign or domestic phos- 
phate deposit. The Bone Valley deposit has well-defined geo- 
graphical limitations, and certainly at some future date it will 
be depleted. Production levels are eventually expected to 
diminish because of increases in capital costs and depletion 
of the reserves. Other possible limitations to capacity re- 
placement and future growth include environmental and other 
Government regulation, productivity lags, and inadequacy of 
Florida's transportation system for phosphate rock. These 
and other factors expected to affect the future output of the 
Florida phosphate industry are discussed fully in appendix 
D. 

Florida's phosphate industry has access to both domestic 
and international trade through the Ports of Tampa, Boca 
Grande, and Jacksonville. In terms of access to eastern and 
many midwestern domestic markets, Florida's phosphate 
producers have several advantages over phosphate produc- 
ers from the Western States. 11 One advantage is Florida's 
proximity to the Mississippi River, which provides direct ac- 
cess to the farming heartland of the United States, where 
much phosphate is used in the form of fertilizers. Extensive 
barge transshipment services that utilize the Mississippi and 
other rivers (fig. 5) are also available to the Florida producers. 
In addition, overland transportation costs to the eastern mar- 
kets and many of the midwestern markets are lower from 
Florida. From figure 6, which shows the rail transportation 
rates for selected interstate movements of phosphate rock, 
it is apparent that the overland distances and shipping costs 
to these markets are less from central Florida than from the 
western phosphate producing States. Moreover, Florida's 
phosphate rock mining production costs are lower than those 
of the western operations. Because of these cost advantages, 
Florida phosphate producers are able to furnish domestic 
consumers with some of the lowest cost fertilizer available. 

In 1976 the Corn Belt (which is identified in figure 7) ac- 
counted for 33 percent of U.S. phosphatic fertilizer con- 
sumption. The Northern Plains States, Great Lakes States, 
and Appalachian States together used 31 percent of the do- 
mestic supply. The Mississippi River and its tributaries pro- 
vide convenient, low-cost water transportation to these areas. 
Together with the Delta States and the Southern Plains States, 



11 The major producers of phosphate rock among the Western States are 
Idaho, Montana, Utah, and Wyoming. 



these areas accounted for 75 percent of domestic phosphatic 
fertilizer consumption in 1976. Consumption shares for these 
and other U.S. regions are shown in figure 7. 



U.S. Supply and Demand 

U.S. phosphate rock production has increased steadily over 
time (fig. 8) and in 1978 reached an alltime high, as shown 
in table 28. Florida and North Carolina accounted for about 
11 percent, and Tennessee accounted for 4 percent. The 
total value of marketable phosphate rock production from 
1 960 to 1 977 is illustrated graphically in figure 9. The average 
unit values of this production (per metric ton) are listed in 
table 29 and are also shown graphically in figure 10. 

The Florida phosphate industry consists mainly of a rela- 
tively small number of large, vertically integrated companies 
that mine and beneficiate phosphate rock and also manu- 
facture fertilizers and related chemicals. Table 30 lists Flor- 
ida's phosphate rock producers, and these producers are 
located by reference numbers (as identified in the table) on 
the map in figure 1 1 . In 1977 Florida's 16 producers of phos- 
phate rock operated at between 85 and 97 percent of their 
production capacity. 

Table 31 lists companies that manufacture phosphate 
products, and figure 12 shows the location of their plants 
across the United States (again through the use of reference 
numbers). As shown in table 32, Florida's phosphatic fertilizer 
production capacity for 1 978 exceeded the total capacity of 
the rest of the Nation. In 1978 Florida operations had the 
capacity to produce 58.4 percent of the Nation's wet-process 
phosphoric acid, 50.3 percent of its ammonium phosphate, 
and 74.6 percent of its concentrated superphosphate. 

In addition to the 16 firms engaged in phosphate rock min- 
ing in Florida, 8 other firms mine phosphate rock in the United 
States. Some of these 24 companies operate in more than 
one State. There are four phosphate rock mining operations 
in Tennessee, five in Idaho, and one each in North Carolina, 
Utah, Alabama, and Montana. Phosphate rock mining op- 
erations in States other than Florida are listed in table 33, 
and their locations are shown (by reference numbers) in figure 
11. 

In 1978 the value of U.S. phosphate rock production ex- 
ceeded $928 million, as shown in table 34. Approximately 88 
percent of this production was processed by domestic com- 
panies into agricultural fertilizers at locations shown in table 
31 and figure 12. The rest was used in animal feed, detergent 
manufacture, and miscellaneous applications, as shown in 
figure 13. A breakdown of domestic phosphate rock use in 
1977 according to geographic area is shown in figure 14. 

Domestic demand for phosphate rock in 1978 was 35.9 
million metric tons, as shown in table 35. Based on a projected 
annual growth rate of 2 to 3 percent, domestic demand by 
1985 would be more than 45 million metric tons (20). It was 
estimated that fertilizer demand, the major factor in this pro- 
jected growth, will account for 85 percent of the domestic 
demand for phosphate rock in 1985. Florida phosphate rock 
production in 1985 was estimated at approximately 54 million 
metric tons, of which about 12 million tons is expected to be 
exported. Total U.S. exports of phosphate products, in phos- 
phate rock equivalence, were estimated at more than 26.5 
million metric tons for 1978 (table 36). 



23 




LEGEND 

Capital ® 
City • 

Waterway / 



Figure 5.— Inland, intracoastal, and ocean water routes available for ship and barge movement of phosphate rock in 
the Eastern United States. 



24 



$14i 



/° ft fco/T 




;SOUlM DAKOTA 



NlSCONSIN 

16.78 



dCX*" 1 , 



£17.04 w^>> 



$47.90 



$15.18 



13 TV 


f^ 






tfO 






^ ^fe^ 




f\ 


^J)"- 1 -^ ** 






v^ 



SOURCE: INTERSTA TE COMMERCE COMMISSION 



Figure 6.— Rail rates at ex parte 336 level for selected movements of phosphate rock (estimates based on rates per 
net short ton of rock). 



Income, Employment, and Output 



Taxes 



Input-output (1-0) multipliers were used to estimate the total 
nationwide impacts of the Florida phosphate industry on in- 
come, employment, and output. These multipliers were based 
on a national 1-0 table that included data for 404 industrial 
sectors. 

The results of this analysis are presented in table 37, which 
represents an expansion of the data presented in table 25 
on the combined statewide impacts of Florida phosphate op- 
erations on income, employment, and output. Using the 1-0 
multipliers, it was estimated that $391 million in indirect and 
induced income will be generated by the Florida phosphate 
industry outside the State in 1981; this would bring the na- 
tionwide total income generated by Florida phosphate op- 
erations to $838.5 million. Similarly, it was estimated that 
some 60,000 jobs outside the State will be attributable to the 
indirect and induced effects of the Florida phosphate industry 
in 1981, and the direct and indirect output expected to be 
generated by the Florida industry outside the State was pro- 
jected at $1.4 billion. Through addition of the State and rest- 
of-Nation estimates, it was estimated that on a national level 
the Florida phosphate industry in 1981 can be expected to 
account for 108,000 jobs and approximately $2,765 million 
in gross output. 



Estimates of the fiscal benefits expected to be associated 
with the Florida phosphate industry in 1981 are shown in 
table 38, based on 1977 dollars. It was previously estimated 
that the industry would pay out $99.6 million in Florida tax 
revenues (see the subsection, "State and County Tax Rev- 
enues.") In addition, Federal tax revenues and tax revenues 
to other States attributable to the Florida phosphate industry 
and related activities were estimated at $21 7 million for 1 981 . 
This means that a total of $31 6.6 million in Federal and State 
tax revenues can be expected to be generated by the Florida 
phosphate industry in 1981. 

PERSONAL INCOME TAXES 

Based on the assumption of an effective income tax rate 
of 7 percent, Federal personal income tax revenues of at 
least $58 million would be realized from the previously esti- 
mated $838.5 million (table 37) in income expected to be 
generated nationwide by the Florida phosphate industry in 
1 981 . The 7 percent rate was based on the assumption that 
an employee would be married, have two children, and claim 
the standard deduction. Since Florida has no State personal 
income tax, there is no State tax revenue from phosphate 



25 







Figure 7.— Domestic use of phosphate as fertilizer, by region, in 1976 (percent of total). 



industry employees. However, personal income tax revenue 
to States other than Florida from income generated by the 
Florida phosphate industry was estimated at more than $2 
million for 1981. Thus, the total Federal and State income 
tax contribution resulting from Florida phosphate industry 
activity in 1981 can be expected to be at least $60 million, 
as shown in table 38. 

CORPORATE INCOME TAXES 

A Federal corporate income tax rate of 4 percent of the 
total value of phosphate-related output was assumed for 1981 . 
By applying this rate to the $2,765 million projection of total 
output value expected to be generated by the Florida phos- 
phate industry in 1 981 (table 37), it was estimated that $1 1 0.6 
million in Federal corporate income tax payments will result 
from the industry and its related activities in that year. State 
corporate income tax rates were calculated, based on U.S. 
Internal Revenue Service publications, to average about 0.85 
percent of gross output. By applying this rate to total phos- 
phate-related output outside Florida, the estimated contri- 
bution of the Florida phosphate industry to other States' cor- 
porate income tax revenue was projected at about $1 2 million 
for 1981 . Therefore, total Federal and State corporate income 
tax revenue from the Florida phosphate industry and its re- 
lated activities for 1 981 was estimated at about $1 28.4 million. 



SALES AND PROPERTY TAXES 

Sales tax payments generated by the phosphate industry 
were estimated for States other than Florida by applying a 
rate of 0.31 percent (based on national averages of taxes 
paid) to the estimated total rest-of-Nation output of $1 ,405 
million for 1981 (table 37). The resultant estimate of $4.4 
million, together with the Florida sales tax estimate of $25 
million for 1 981 (table 38), indicates that more than $29 million 
in State sales tax payments will be generated by the Florida 
phosphate industry and related activities in that year. 

Similarly, it was estimated that the industry and its related 
activities in 1981 will generate $20 million in Florida ad va- 
lorem property taxes and $30 million in ad valorem property 
taxes paid to other States (or divisions thereof), or $50 million 
in total ad valorem property taxes nationwide (table 38). 

Effects on U.S. Balance of Payments 



It was estimated that by 1981 the Florida phosphate in- 
dustry could make an annual positive contribution to the U.S. 
balance of payments of approximately $961.8 million. A 
breakdown of this estimate is shown below (based on the 
assumption that there will be no increase in price for the 
products listed). 



26 



z 
g 

o 

D 
Q 
O 
cc 
a. 




22 r- 



1960 



1965 



1970 



1977 



Figure 8.— Geographic breakdown of marketable phos- 
phate rock production in the United States, 1960-77. 



k. 

JO 

"5 

■o 

CM 
l>. 

en 



900 r- 



800 - 



700 - 



600 



500 



400 



300 



> 200 



100 




^y Florida '-*.._ ._/ 

(includes North Carolina 1964 72) 



Western States 



Tennessee 



vvesxern csiaies # j» 

"li-rfi i i i rrfft-m-n 



1960 



1965 



1970 



1977 



» 

k. 

(0 

o 

■o 

CM 

en 



O 

H 

U 

cc 



cc 

Hi 

(L 
111 

D 
_l 
< 

> 




1960 



1965 



1970 



1977 



Figure 9. — Value of U.S. marketable phosphate rock pro- 
duction, by geographic area, 1960-77. 



Figure 10.— Average value of U.S. marketable phosphate 
rock production, by geographic area, 1960-77. 



Exports of phosphate rock 510.0 

Exports of phosphatic fertilizer 500.0 

Imports of sulfur - 53.5 

Potential reduction of fluorine imports 5.3 

Total (net) 961.8 

Included in this estimate is the positive effect of exports of 
Florida phosphate rock and agricultural chemicals and the 
negative effect of imports of sulfur to Florida for sulfuric acid 
production. Also included is the value of fluosilicic acid pro- 
duced in Florida, which reduces U.S. imports of fluorspar by 
a proportional amount. 

In 1 978 the United States exported a total of 20,890,000 
metric tons of phosphate rock and fertilizer products valued 
at more than $1 .3 billion. Of this total, 95 percent was from 
Florida (including a small amount from North Carolina). In- 
cluded in this total were ammonium phosphates valued at 
$579.8 million; triple superphosphates worth $143.2 million; 
natural phosphate fertilizer, $25.6 million; Florida land pebble, 
$341.1 million; wet-process phosphoric acid (P 2 5 ), $91.9 
million; and smaller amounts of other fertilizers. Exports of 
phosphate products from Florida were valued at more than 
$1.0 billion in 1978. 

Total exports of phosphate rock from Florida alone for 1 981 
were projected at 17 million metric tons. Assuming an av- 
erage export price for the first half of 1979 of $24.55 per 
metric ton, f.o.b. Port of Tampa, Florida phosphate rock ex- 
ports in 1981 would be worth approximately $510 million. If 
it is further assumed that exports of phosphate fertilizers from 
Florida ports in 1981 will be worth $500 million, the total value 
of Florida's exports of phosphate products (phosphate rock 
plus fertilizers) would be more than $1 billion in 1981. 

Florida ranks first in the United States in sulfuric acid pro- 



27 



Table 28.— Marketable production of phosphate rock in the United States, by geographic area, 1960-78 



Producing area 


Quantity, 
thousand 
metric tons 


Value, thousand 

(constant 1972) 

dollars 


Value, thousand 
(current) 
dollars 


1960: 

Florida 

Tennessee 

Western States' ... 


12,519 
1,970 
3,309 


119,974 
22,457 
28,413 


82,386 
15,421 

19,511 


U.S. total 2 


17,789 


170,843 


117,318 


1961: 

Florida 


14,011 
2,271 
2,575 


139,104 
26,915 
22,620 


96,371 


Tennessee 

Western States' ... 


18,647 
15,671 


U.S. total 2 


18,857 


188,639 


130,689 


1962: 

Florida 

Tennessee 

Western States' ... 


14,173 
2.457 
3,064 


136,189 
27.943 
29,103 


96,081 
19,714 
20,532 


U.S. total 2 


19,693 


193,235 


136,327 


1963: 

Florida 

Tennessee 

Western States' ... 


14,826 
2,390 
2,957 


143,136 
25,093 
28,096 


102,471 
17,964 
20,114 


U.S. total 2 


20,173 


196.325 


140,549 


1964: 

Florida 3 

Tennessee 

Western States' ... 


17.389 
2,480 
3,460 


167,663 
26,058 

30,371 


121,908 
18,947 
22,083 


U.S. total 2 


23,329 


224,093 


162,938 


1965: 

Florida 4 


19,562 
2,679 
4,463 


190,067 

30,00 
39,268 


141,258 


Tennessee 

Western States' ... 


22,296 
29,184 


U.S. total 2 


26.704 


259,334 


192,738 


1966: 

Florida 4 


27,059 
2,835 
5,527 


254,171 
31,118 
54,851 


195,102 


Tennessee 

Western States' ... 


23,886 
42,104 


U.S. total 2 


35,420 


340,141 


261,092 


1967: 

Florida 4 


28,948 

2,714 
4,416 


262,956 
28,564 

45,037 


207,788 


Tennessee 

Western States' ... 


22,571 
35,588 


U.S. total 2 


36,079 


336,557 


265,947 


1968: 

Florida 4 


29,966 
2,857 
4,599 


234,127 
28,616 

40,870 


193,319 


Tennessee 

Western States' ... 


23,628 
33,746 


U.S. total 2 


37,422 


303,611 


250,692 


1969: 

Florida 4 


27,152 
2,970 
4,101 


185,398 
21,780 
33,469 


160,777 


Tennessee 5 

Western States' ... 


18,888 
29,024 


U.S. total 2 


34,224 


240,647 


208,689 



Producing area 


Quantity, 
thousand 
metric tons 


Value, thousand 

(constant 1972) 

dollars 


Value, thousand 
(current) 
dollars 


1970: 

Florida 4 


28,375 
2,869 
3,898 


174,006 
16,919 
31,521 


158,972 


Tennessee 5 

Western States' ... 


15,457 
28,789 


U.S. total 2 


35,143 


222,437 


203,218 


1971: 

Florida 4 

Tennessee 

Western States' ... 


29,167 
2,332 
3,778 


174,706 
12,655 
24,916 


167,753 
12,151 
23,924 


U.S. total 2 


35,277 


212,277 


203,828 


1972: 

Florida 4 


30,954 
1,954 
4,132 


173,910 
10,732 
23,268 


173,910 


Tennessee 

Western States' ... 


10,732 
23,268 


U.S. total 2 


37,040 


207,910 


207,910 


1973 

Florida 4 


31 ,232 
2,279 
4,716 


181,147 
12,097 
32,338 


191,654 


Tennessee 

Western States' ... 


12,799 
34,214 


U.S. total 2 


38,226 


225,583 


238,667 


1974: 

Florida 4 


33,548 
2,187 
5,711 


352,507 

15,915 
63,769 


408,979 


Tennessee 

Western States' ... 


18,465 
73,985 


U.S. total 2 


41 ,446 


432,192 


501,429 


1975: 

Florida 4 

Tennessee 

Western States' ... 


36,922 
2,078 
5,284 


786,750 
22,653 

73,165 


1,000,352 
28,803 
93,029 


U.S. total 2 


44,285 


882,567 


1,122,184 


1976: 

Florida 4 ■-.. 


37,697 

1,634 
5,340 


648,245 
10,860 
50,647 


867,092 


Tennessee 

Western States' ... 


14,527 
67,746 


U.S. total 2 


44,671 


709,753 


949,365 


1977: 

Florida 4 


40,575 
1,747 
4,934 


507,304 
10,065 
62,856 


718,393 


Tennessee 

Western States' ... 


14,253 
89,011 


U.S. total 2 


47,256 


580,225 


821,657 


1978: 

Florida 4 _ 


43,258 
1,709 
5,070 


537,290 

9,236 

64,178 


817,165 


Tennessee 

Western States 6 ... 


14,047 
97,608 


U.S. total 2 


50,037 


610,704 


928,820 



' Includes Arkansas (1 963-66 and 1 973-77), California (1 968-70 and 1 973-77), 
Idaho, Missouri, Montana, Utah, and Wyoming. 

2 Data may not add to totals shown because of independent rounding. 

3 Includes North Carolina production of approximately 6,350 metric tons. 

4 Includes North Carolina. 

5 Includes Alabama. 

s Includes Alabama, Utah, Wyoming, Montana, and Idaho (1978). 



duction, most of which is captive production for the phosphate 
industry. In 1978 the Florida phosphate industry consumed 
775,949 metric tons of imported sulfur. Using the 1978 year- 
end value of sulfur of $69 per ton, these imports represented 
a $53.5 million negative contribution to the U.S. balance of 
payments. This negative contribution is chargeable to the 
Florida phosphate industry, since this sulfur would not have 



to be imported if the Florida phosphate industry did not exist. 
If conditions remain basically the same, $53.5 million can 
also be expected to represent the value of sulfur imports for 
the phosphate industry in 1981. 

Fluorine in the form of fluosilicic acid is recovered from 
phosphoric acid plants in Florida and in other States from 
Florida phosphate rock. Fluorine has metallurgical applica- 



28 



Table 29.— Average values of marketable phosphate rock production in the United States, by geographic area, 

1960-78 





Value per metric ton 




Constant 1 






1972 


Current 


Producing area 


dollars 


dollars 


1960: 






Florida __ .-- 


9.58 


6.58 


Tennessee 


11.40 


7.83 


Western States 2 ... 


8.59 


5.90 


U.S. average 


9.60 


6.59 


1961: 






Florida 


9.93 


6.88 


Tennessee 


11.85 


8.21 


Western States 2 .. 


8.76 


6.08 


U.S. average 


10.00 


6.93 


1962: 






Florida 


9.61 


6.78 


Tennessee 


11.37 


8.02 


Western States 2 ... 


9.50 


6.70 


U.S. average 


9.81 


6.92 


1963: 






Florida 


9.65 


6.91 


Tennessee 


10.50 


7.52 


Western States 2 ... 


9.50 


6.80 


U.S. average 


9.74 


6.97 


1964: 






Florida 3 


9.64 


7.01 


Tennessee 


10.51 


7.64 


Western States 2 .. 


8.77 


6.38 


U.S. average 


9.61 


6.99 


1965: 






Florida 3 


9.71 


7.22 


Tennessee 


11.19 


8.32 


Western States 2 .. 


8.80 


6.54 


U.S. average 


9.71 


7.22 


1966: 






Florida 3 


9.39 


7.21 


Tennessee __ 


10.97 


8.42 


Western States 2 ... 


9.91 


7.61 


U.S. average 


9.60 


7.37 


1967: 






Florida 3 


9.08 


7.18 


Tennessee 


10.52 


8.31 


Western States 2 ... 


10.20 


8.06 


U.S. average 


9.34 


7.37 


1968: 






Florida 3 


7.82 


6.45 


Tennessee 


10.01 


8.27 


Western States 2 ___ 


8.90 


7.34 


U.S. average 


8.11 


6.70 


1969: 






Florida 3 


6.82 


5.92 


Tennessee 4 _ 


7.33 


6.36 


Western States 2 ... 


8.16 


7.08- 


U.S. average 


7.03 


6.10 





Value per metric ton 




Constant 1 






1972 


Current 


Producing area 


dollars 


dollars 


1970: 






Florida 3 


6.13 


5.60 


Tennessee" 


5.90 


5.39 


Western States 2 ... 


8.08 


7.39 


U.S. average 


6.34 


5.79 


1971: 






Florida 3 


6.00 


5.75 


Tennessee .. 


5.43 


5.21 


Western States 2 


6.60 


6.34 


U.S. average 


6.02 


5.78 


1972: 






Florida 3 


5.62 


5.62 


Tennessee 


5.49 


5.49 


Western States 2 ... 


5.63 


5.63 


U.S. average 


5.61 


5.61 


1973: 






Florida 3 


5.81 


6.14 


Tennessee 


5.40 


5.71 


Western States 2 ... 


7.60 


7.18 


U.S. average 


5.90 


6.24 


1974: 






Florida 3 


10.41 


12.07 


Tennessee 


7.51 


8.71 


Western States 2 ... 


11.48 


13.32 


U.S. average 


10.43 


12.10 


1975: 






Florida 3 _._ 


21.21 


26.96 


Tennessee 


10.84 


13.78 


Western States 2 .__ 


13.56 


17.24 


U.S. average 


19.93 


25.34 


1976: 






Florida 3 


17.09 


22.85 


Tennessee 


6.61 


8.85 


Western States 2 ... 


10.24 


13.69 


U.S. average 


15.88 


21.25 


1977: 






Florida 3 


13.81 


19.55 


Tennessee 


6.35 


8.99 


Western States 2 ... 


13.77 


19.49 


U.S. average 


12.45 


17.61 


1978: 






Florida 3 


12.42 


18.89 


Tennessee 


5.40 


8.22 


Western States 5 ... 


12.66 


19.25 


U.S. average 


12.20 


18.56 



1 Constant dollar values have been rounded to nearest hundredth. 

2 Includes Arkansas (1963-66), California (1968-70), Idaho, Montana, 

souri (1973-77), Utah, and Wyoming. 

3 Includes North Carolina. 

4 Includes Alabama. 

5 Includes Alabama, Idaho, Montana, Utah, and Wyoming (1978). 



Mis- 



tions as well as uses in the ceramics and chemical manu- 
facturing industries. Recovery of fluosilicic acid from phos- 
phoric acid plants in 1978 was estimated at 70,000 metric 
tons. At an average value of $80 per ton, this means that 
$5.6 million worth of fluosilicic acid was produced. In 1978 
U.S. imports of fluorspar totaled 1 .0 million metric tons, which 
represented about 80 percent of the Nation's fluorine require- 
ments. This total would have been larger by a value of $5.6 
million were it not for Florida's byproduct production of fluos- 
ilicic acid. Thus $5.6 million in byproduct fluosilicic acid pro- 
duction was a positive contribution to the U.S. balance of 
payments because this acid would have had to have been 
imported if it had not been produced domestically. 



Impact on the Domestic Sulfur Industry 



The Florida phosphatic fertilizer industry consumes about 
one-half of all U.S. sulfur production, in addition to its con- 
sumption of imported sulfur. In 1978 the State's phosphatic 
fertilizer industry consumed approximately 5.8 million metric 
tons of domestic sulfur, and it was estimated that in 1981 
this consumption would reach a level of about 6.0 million 
metric tons. This means that at a sulfur price of $80 per ton, 
the Florida fertilizer industry would purchase $480 million of 
domestic sulfur in 1981. 

Also, the Frasch sulfur industry, which mines sulfur using 



29 



Table 30.— Florida phosphate rock producers 



Commodity, company, and 
address 


Map 

reference 

number (as 

shown in 

figure 11) 


Number of 
mines (all 
open pit) 


County 


LAND PEBBLE 

Agrico Chemical Co. 

Pierce, Ra. 33867 


1, 3 


3 


Polk. 


Bordon Chemical Co. 

Box 790 


4 


1 


Hillsborough. 


Plant City, Fla. 33566 








Brewster Phosphate Co. 
Bradley, Fla. 33835 


5 


2 


Do. 


C. F. Industries, Inc. 
Box 1480 
Bartow, Fla. 33830 


14 


1 


Hardee. 


Gardinier, Inc. 
Box 3269 
Tampa, Fla. 33601 


6 


1 


Polk. 


International Minerals 
& Chemical Co. 
Box 867 
Bartow, Fla. 33830 


9, 11 


3 


Do. 


Mobile Chemical Co. 
Box 311 
Nichols, Fla. 33863 


12, 13 


2 


Do. 


Occidental Petroleum 
Corp., Suwannee River 
Phosphate Div. 
Box 300 

White Springs, Fla. 
32096 


21, 22 


2 


Hamilton. 


Swift Chemical Corp. 
Box 208 
Bartow, Fla. 33830 


13 


2 


Polk. 


T. A. Minerals Corp. 
Pierce, Fla. 33867 


16 


1 


Do. 


U.S.S. Agri-Chemicals, Inc. 
Fort Mead, Fla. 33841 


15 


1 


Do. 


W. R. Grace & Co. 
Box 471 
Bartow, Fla. 33830 


7,8 


2 


Do. 


SOFT ROCK 
Howard Phosphate Co. 
Box 13800 
Orlando, Fla. 32809 


19,20 


1 


Citrus. 


Kellogg Co. 
Box 200 
Hernando, Fla. 32642 


17 


1 


Do. 


Loncala Phosphate Co. 
Box 766 
High Springs, Fla. 32643 


23 


1 


Gilchrist, 
Marion. 


Manko Co., Inc. 
Box 557 
Ocala, Fla. 32670 


18 


1 


Citrus. 



a hot-water melting process, is heavily dependent on the 
Florida fertilizer industry. 

Uranium Recovery from Wet-Process 
Phosphoric Acid 

At the 1 978 production cost of less than or equal to $1 6.50 
per metric ton, phosphate rock reserves in the central Florida 
region were estimated to total 340 million metric tons. It has 
been estimated that these reserves contain between 0.01 
and 0.02 percent uranium oxide (U 3 O e ), which can be re- 
covered as byproduct uranium from wet-process phosphoric 
acid plants. Several companies have shown interest in re- 
covering this resource. 

As is the case with any byproduct recovery, the potential 
U 3 8 resources available as a byproduct of wet-process 
phosphoric acid are limited by the primary production sched- 
ule. This means that if the price of phosphate rock increases, 
the amount of available reserves will also increase with a 
potentially commensurate increase in U 3 8 recovery, assum- 
ing that the then-available reserves contain economically re- 
coverable U 3 8 . However, any delays in installing byproduct 
recovery plants would be expected to cause a corresponding 
loss in U 3 8 resources. 

Assuming a U 3 8 content of 0.012 percent for all central 
Florida phosphate rock, total U 3 8 reserves in the 340 million 
metric tons of rock would be 40,800 tons. At an overall re- 
covery factor of 86 percent (95 percent from phosphoric acid 
production and 90 percent from the byproduct recovery plant), 
about 34,884 metric tons of U 3 8 could be recovered from 
wet-process phosphoric acid at a production cost of about 
$20 per pound, including a 20-percent return on invested 
capital. This cost, which is substantially lower than the 1978 
market price for U 3 8 of more than $40 per pound, indicates 
the economic attractiveness of U 3 8 byproduct production 
from wet-process phosphoric acid. The total value of poten- 
tially recoverable U 3 8 , assuming 34,884 metric tons of re- 
sources and a spot price at yearend 1977 of $42 per pound 
of U 3 8 , would be approximately $3.23 billion. If in 1981 the 
price of U 3 8 is higher than the $42-per-pound price which 
has been estimated for that year, the value of this resource 
would rise accordingly. The technology for U 3 8 recovery 
appears feasible, and the economic considerations make 
expanded commercialization of this uranium production an 
attractive prospect. 

In 1 976 Uranium Recovery Corp. (URC) installed a uranium 
recovery module at the W. R. Grace & Co. plant near Bartow, 
Fla. From this plant, concentrated stripped solution is shipped 
to URC's central processing plant near Mulberry, Fla., where 
yellowcake (certain uranium concentrates produced by mills) 
is recovered from the solution. Wyoming Mineral Corp., a 
subsidiary of Westinghouse Electric Corp., has constructed 
a uranium oxide recovery facility at Farmland Industries' 
phosphoric acid complex, also near Bartow. The facility went 
onstream in August 1 978, and plans were to recover about 
450,000 pounds of U 3 8 per year. 

Several additional companies announced plans in 1978 to 
recover U 3 8 from wet-process phosphoric acid and to build 
recovery facilities. One of these, International Minerals and 
Chemicals Corp., planned to recover 1.2 million pounds of 
U 3 8 annually from C.F. Industries' two wet-process phos- 
phoric acid plants in Polk and Hillsborough Counties and an 
additional 600,000 pounds per year from its own New Wales 
chemical plant in Polk County. 



30 



Table 31 . — Domestic phosphate rock consumers 



Company 



City and State 



Map reference 

number (as shown 

in figure 12) 



Products manufactured 



Agrico-Chem-Williams 
Borden Chemical Co. . 



C. F. Industries Inc. 

Englehard M&C-Con. Serve Inc. . 

Farmland Industries 

Gardinier, Inc. 

W. R. Grace & Co. 

Homes 

International Minerals & Chemical Corp. 



Mobil Chemical Co. 
C. F. Industries Inc. 
Royster Co. 



Stauffer Chemical Co. 
U.S.S. Agri-Chemicals 



U.S.S. Agri-Chemicals 

Occidental Agri-Chemicals 



Texasgulf Inc. 

Stauffer Chemical Co. 

Hooker Chemical Co. 

Monsanto Industrial Chemicals Co. 

Tennessee Valley Authority 

U.S.S. Agri-Chemicals 

Mississippi Chemical Corp 



Beker Industries Corp. .. 
Allied Chemical Corp. .. 

Freeport Minerals 

Gardinier, Inc. 

W. R. Grace & Co. 

Farmland Industries 

First Mississippi Corp. .. 
Beker Industries Corp. __ 

Olin Corp. 

Mobil Chemical Co. 

Farmland Industries 

Nipak, Inc. 

Olin Corp. 

Phosphate Chemical ... 

El Paso Products 

Valley Nitrate Producers 
Stauffer Chemical Co. .. 



F.M.C. Corp. 

Monsanto Industrial Chemicals Co. 
J. R. Simplot 



Beker Industries Corp. 

Gulf Resources 

Stauffer Chemical Co. 

Duval Corp. 

Kaiser Steel 

Collier Carbon & Chemical 

Agrico Chem-Williams 

Borden Chemical Co. 

C.F. Industries Inc. 

Grace and U.S.S. Agri-Chemicals ._ 
Occidental Agricultural Chemical Co. 
Valley Nitrogen Products . .. 

Do. 



Pierce, Fla. 

Piney Point, Fla. 



Bartow, Fla. 
Nichols, Fla. 
Pierce, Fla. 
Tampa, Fla. 
Bartow, Fla. 
Pierce, Fla. 
Bonnie, Fla. 



Nichols, Fla. . 
Bonnie, Fla. . 
Mulberry, Fla. 



Tarpon Springs, Fla. 
Ft. Meade, Fla. 



Bartow, Fla. 

White Springs, Fla. 

Lee Creek, N.C. ... 
Columbia, Tenn. ... 
....Do. 

....Do. 

Muscle Shoals, Ala. 

Cherokee, Ala. 

Pascaquela, Miss. . 



Taft, La. 

Geismar, La. ... 
Uncle Sam, La. . 

Helena, Ark. 

Joplin, Mo. 

....Do. 

Ft. Madison, La. 
Marseilles, III. ... 

Joliet, III. 

Depue, III. 

Lawrence, Kans. 
Kerens, Tex. ... 
Pasadena, Tex. 

....Do. 

Odessa, Tex. ... 
Chandler, Ariz. . 
Garfield, Utah .. 



Pocatello, Idaho 

Soda Springs, Idaho 
Pocatello, Idaho 



Conda, Idaho ... 
Kellogg, Idaho .. 
Silver Bow, Mont. 
Hanford, Calif. .. 
Fontana, Calif. .. 
Pittsburg, Calif. . 
Donaldsville, La. 

Streator, III. 

Hardee City, Fla. 

Bartow, Fla. 

Lathrop, Calif. .. 

Helm, Calif. 

Bena, Calif. 



1 
2 

3 
4 
5 
6 

7 
8 
9 

10 
11 
12 

13 
14 

15 
16 

18 
19 
20 
21 
22 
23 
24 

26 
27 
29 
30 
31 
32 
33 
34 
35 
36 
37 
38 
39 
40 
41 
42 
43 

45 
46 
47 

48 
49 
50 
51 
52 
53 



Wet-process phosphoric acid, ammonium phosphate. 
Wet-process phosphoric acid, ammonium phosphate, 
concentrated superphosphate. 

Do. 

Do. 

Do. 

Do. 

Do. 
(Idle plant.) 

Wet-process phosphoric acid, ammonium phosphate, 
concentrated superphosphate. 
(Idle plant.) 

Wet-process phosphoric acid, ammonium phosphate. 
Wet-process phosphoric acid, ammonium phosphate, 
concentrated superphosphate. 
(Idle plant.) 

Wet-process phosphoric acid, concentrated super- 
phosphate. 

Ammonium phosphate. 

Wet-process phosphoric acid, ammonium phosphate, 
concentrated superphosphate. 

Do. 
Elemental phosphorus. 

Do. 
Agricultural chemicals. 
Elemental phosphorus. 
Ammonium phosphate. 

Wet-process phosphoric acid, concentrated super- 
phosphate. 
Wet-process phosphoric acid, ammonium phosphate. 

Do. 
Wet-process phosphoric acid. 

Do. 
Concentrated superphosphate. 
(Idle plant.) 

Wet-process phosphoric acid, ammonium phosphate. 
(Idle plant.) 

Wet-process phosphoric acid. 
Wet-process phosphoric acid, ammonium phosphate. 
(Idle plant.) 

Ammonium phosphate. 

Wet-process phosphoric acid, ammonium phosphate. 
(Idle plant.) 

Do. 

Do. 
Wet-process phosphoric acid, ammonium phosphate, 
concentrated superphosphate. 
Elemental phosphorus. 

Do. 
Wet-process phosphoric acid, ammonium phosphate, 
concentrated superphosphate. 

Do. 
Wet-process phosphoric acid, ammonium phosphate. 
Elemental phosphorus. 
Wet-process phosphoric acid. 
(Idle plant.) 

Wet-process phosphoric acid. 
Wet-process phosphoric acid, ammonium phosphate. 
Wet-process phosphoric acid. 

Do. 2 
Wet-process phosphoric acid. 3 
Wet-process phosphoric acid. 
Wet-process phosphoric acid, ammonium phosphate. 
Wet-process phosphoric acid. 



1 Recent additions to this table; not shown on map in figure 12. 

2 Plant planned. 

3 Plant under construction. 



31 



Western phosphate rock includes Montana, Utah, 
Idaho, and Wyoming-90% consumed dome tically 
and 10% exported. 




Tennessee 
i phosphate rock- 
all domestically 
consumed. 



Florida and 
North Carolina 
phosphate rod 
69% consumed 
domestically ai 
31% exported. 



Figure 11.— Location of phosphate rock production (blackened areas) in the United States, 1977. (Reference numbers, 
identified in table 30 and 33, indicate locations of individual phosphate rock producers.) 



Table 32. 



-Phophate fertilizer production capacity in Florida, 1978 

(Thousand metric tons P 2 5 ) 



Company 


Plant location 


Phosphoric acid, 
wet-process 


Ammonium 
phosphate 


Concentrated 
superphosphate 


Agrico Chemical-Williams 


Pierce, Fla 

Piney Point, Fla. „ 

Bonnie, Fla. 

Plant City, Fla. 


247 
159 
626 
567 
136 
413 
494 
345 
299 
680 
526 
122 
NAp 
160 


75 

77 
576 
249 
109 
163 
227 
NAp 

95 
227 
275 

73 
125 
NAp 


250 


Borden Chemical Co. 


30 


C. F. Industries Inc 


NAp 


Do. 


340 


Engelhard M & C-Con. Serve Inc 


Nichols, Fla. 

Pierce, Fla. 

Tampa, Fla. 

Bartow, Fla. 

.... Do. _ _ 


117 


Farmland Industries 


79 


Gardinier, Inc. 

Grace & U.S.S. Agri-Chemicals, Inc. 


340 
NAp 


W. R. Grace & Co. - 


290 


International Minerals & Chemical Co. 


Bonnie, Fla. 

White Springs, Fla. 

Mulberry, Fla. _ 


125 


Occidental Agricultural Chemical Co. 


71 


Royster Co. 


88 


U.S.S. Agri-Chemicals, Inc. 


Bartow, Fla. 

Fort Meade, Fla 


NAp 


Do. 


110 








Total 




4,799 


2,272 


1,841 









NAp Not applicable. 



Source: National Fertilizer Development Center (13). 



32 



Table 33. — Phosphate rock producers in States other than Florida 





Map reference number 










for production location 










(as shown in figure 








State, company, and address 


11) 


Type of activity 


Production location 


county 


Alabama: 










Monsanto Industrial Chemical Co. 


31 


1 open pit mine 


Limestone, Ala. 




Box 5523 










Denver, Colo. 80217 










Idaho: 










Conda Partnership 


36 


....do 


Caribou, Idaho. 




Box 37 










Conda, Idaho 83230 










Monsanto Industrial Chemical Co. 


37 


...do 


Do. 




Box 816 










Soda Springs, Idaho 83276 










J. R. Simplot Co., Fertilizer Div. 


35 


2 open pit mines 


Bingham and Caribou. 




Box 912 










Pocatello, Idaho 83201 










Stauffer Chemical Co. 


38 


1 open pit mine 


Caribou, Idaho 




Star Route 










Randolph, Utah 84064 










Montana: 










Cominco American, Inc. 


33,34 


2 underground mines 


Powell. 




Garrison, Mont. 59731 










North Carolina: * 










Texasgulf, Inc. 


24 


1 open pit mine 


Beaufort, N.C. 




Box 48 










Aurora, N.C. 27806 










Tennessee: 










Hooker Chemical Co. 


25, 26 


Open pit mines 


Hickman, Tenn. 




Box 591 










Columbia, Tenn. 38401 










Monsanto Industrial Chemical Co. 


27-29 


—.do .... 


Giles, Hickman, Maury, 


and William- 


Columbia, Tenn. 38401 






son, Tenn. 




Stauffer Chemical Co. 


30 


— do 


Maury, Tenn. 




Mt. Pleasant, Tenn. 38474 










Utah: 










Stauffer Chemical Co. 


32 


1 open pit mine 


Uintah, Utah 




Manila Star Route 










Vernal, Utah 84078 











Table 34.— U.S. phosphate rock production, consumption, sales, and exports; and world production 



1973 



1974 



1975 



1976 



1977 



1978 



United States: 

Mine production thousand metric tons— 

Marketable production do... 

Value thousands... 

Average value per metric ton... 

Sold or used by producers thousand metric tons... 

Value thousands... 

Average value per metric ton... 

Imports for consumption 1 thousand metric tons... 

Value thousands... 

Average value per metric ton... 

Exports 2 thousand metric tons. .. 

P 2 5 content do... 

Value thousands- 
Average value per metric ton... 

Consumption, apparent 3 ..thousand metric tons... 

World: Production do... 

' Revised. 

1 U.S. Department of Commerce, Bureau of the Census data. 

2 Exports as reported by companies to the Bureau of Mines. 

3 Quantity sold or used by producers plus imports minus exports. 



126,746 

38,226 

$238,667 

$6.24 

40,862 

$254,846 

$6.24 

59 

$1,288 

$21.85 

12,587 

4,084 

$82,983 

$6.59 

28,334 

98,723 



141,382 

41,446 

$501,429 

$12.10 

43,940 

$529,141 

$12.04 

165 

$8,999 

$54.51 

12,607 

4,053 

$194,015 

$15.39 

31,497 

109,987 



170,112 

44,285 

$1,122,184 

$25.34 

42,129 

$1,052,995 

$24.99 

35 

$1,604 

$48.31 

11,133 

3,588 

$429,222 

$38.56 

31,028 

107,278 



154,309 

44,671 

$949,365 

$21.25 

40,530 

$857,189 

$21.15 

46 

$2,209 

$52.60 

9,453 

3,023 

$272,823 

$28.91 

31,142 

107,616 



166,893 

47,256 

$821,657 

$17.39 

47,437 

$829,084 

$17.48 

158 

$6,079 

$38.47 

13,230 

4,251 

$288,603 

$21.81 

34,365 

116,000 



173,429 

50,037 

$928,820 

$18.56 

48,774 

$901,378 

$18.56 

908 

$24,379 

$26.85 

'12,870 

'4,118 

$297,357 

$23.10 

' 36,812 

125,000 




Figure 12.— Location of phosphate rock consumers in the United States, 1977. (Companies corresponding to map 
reference numbers are listed in table 31.) 



Byproduct Fluorine Production 



Fluorine is principally recovered from the mineral fluorite, 
commonly known as fluorspar. At extrapolated rates of con- 
sumption, all known fluorspar deposits in the world are ex- 
pected to be depleted before the end of the century. In that 
event, the world's fluorine supply would have to be derived 
from newly discovered deposits or from phosphate rock. It 
has been estimated that fluorine resources in phosphate rock 
are adequate to satisfy world demand well into the next cen- 
tury (78). 

Fluorine is necessary to produce aluminum, steel, and many 
chemical compounds. Fluorine demand more than doubled 
during the 1960-70 period, reflecting strong growth in the 
aluminum, chemical, and steel sectors. In 1 976 the aluminum 
industry accounted for 20.2 percent of U.S. fluorine con- 
sumption, or 102,512 metric tons. Consumption by the fluor- 
carbon industry is difficult to estimate because of a scarcity 
of data. Practically all fluorine usage is in the form of acid, 
metallurgical, and ceramic grades of fluorspar. 

In 1978 the United States produced about 20 percent of 
its fluorine requirements and 5 percent of world production. 
It consumed about 30 percent of the world supply. Apparent 
U.S. consumption was approximately 550,000 metric tons in 
1978 and is forecast to be 3.5 times this quantity, or 1.65 
million metric tons, in the year 2000. A straight-line projection 
of domestic production over the last 20 years indicates that 
only about 137,892 metric tons will be produced in the year 



2000. However, it is expected that imports and the domestic 
recovery of fluorine from phosphatic fertilizer production will 
make up for the apparent difference between domestic con- 
sumption and production for the year 2000. 

The largest known source of fluorine in the United States 
is in phosphate rock deposits. Florida phosphate rock con- 
tains from 3 to 4 percent fluorine. Recovery of fluorine from 



FERROPH0SPH0RUS 




NORMAL 
SUPERPHOSPHATE 
OTHER 



Figure 13.— Generalized U.S. phosphate rock use pat- 
tern. 



34 



Table 35.— Phosphate rock sold or used by producers, by use and by geographic area, 1973-78 

(Thousand metric tons) 



Year 


Florida and 
North Carolina 


Tennessee 


Western 
States 


Total 
United States 1 


and 
use 


Rock 


p 2 o 5 

content 


Rock 


PA 
content 


Rock 


PA 
content 


Rock 


P 2 5 
content 


1973: 

Domestic: 

Agricultural 

Industrial 


21,501 
W 


6,732 
W 


14 
2,403 


4 
630 


1,531 
W 


494 
W 


23,046 
5,229 


7,229 
1,362 


Total 

Exports 1 _ 


21,501 
W 


6,732 
W 


2,418 



634 



1,531 
W 


494 
W 


28,275 
12,587 


8,591 
4,084 


Total 2 


33,490 


10,632 


2,418 


634 


4,955 


1,408 


40,862 


12,675 






1974: 

Domestic: 

Agricultural 

Industrial 


24,150 
W 


7,504 
W 



2,365 



642 


1,806 
W 


580 
W 


25,956 
5,376 


8,084 
1,422 


Total 

Exports 1 


24,150 
W 


7,504 
W 


2,365 



642 



1,806 
W 


580 
W 


31 ,322 
12,607 


9,505 
4,053 


Total 2 


36,215 


11,390 


2,365 


642 


5,360 


1,527 


43,940 


13,559 






1975: 

Domestic: 

Agricultural 

Industrial 


23,947 
354 


7,411 

104 



2,171 



560 


1,902 
2,622 


608 
676 


25,849 
5,146 


8,018 
1,340 


Total 

Exports ' 


24,301 
10,102 


7,515 
3,275 


2,171 



560 



4,524 
1,031 


1,283 
313 


30,996 
11,133 


9,358 
3,588 


Total 2 


34,401 


10,790 


2,171 


560 


5,556 


1,597 


42,129 


12,946 






1976: 

Domestic: 

Agricultural 

Industrial 


24,729 
409 


7,631 
120 



1,731 



448 


1,651 
2,575 


524 

661 


26,380 
4,716 


8,156 
1,229 


Total 

Exports 1 


25,138 
8,783 


7,750 
2,825 


1,731 



448 



4,227 
651 


1,187 
197 


31 ,096 
9,435 


9,385 
3,023 


Total 2 


33,921 


10,576 


1,731 


448 


4,878 


1,383 


40,530 


12,408 






1977: 

Domestic: 

Agricultural 

Industrial __ 


27,901 
334 


8,637 
98 



1,723 



436 


2,222 
2,026 


716 
523 


30,123 
4,084 


9,353 
1,056 


Total 

Exports 1 


28,235 
12,759 


8,735 
4,108 


1,723 



436 



4,248 
471 


1,239 
143 


34,207 
13,230 


10,409 
4,251 


Total 2 


40,994 


12,843 


1,723 


436 


4,719 


1,382 


47,437 


14,660 






1978: 

Domestic: 

Agricultural 

Industrial 


' 29,314 
291 


r 8,998 

84 



1,688 



434 


2,018 
2,592 


646 
668 


'31,332 
4,571 


'9,644 
1,186 


Total 2 

Exports' 


' 29,605 
r 1 1,810 


' 9,082 
'3,785 


1,688 



434 



4,611 
1,060 


1,314 
333 


'35,904 
'12,870 


'10,830 
'4,118 


Total 2 _ 


41,415 


12,867 


1,688 


434 


5,671 


1,647 


48,774 


14,948 







' Revised. W Withheld to avoid disclosing company proprietary data. 

1 Exports as reported by companies to the Bureau of Mines. 

2 Data may not add to totals shown because of independent rounding. 



Table 36. — U.S. exports of phosphate products and phosphate rock equivalence, 1978 1 

(Metric tons) 



Data from the U.S. Department of Commerce, Bureau of the Census (37), adjusted by the Bureau of Mines. 



35 



Product 


Quantity 
exported 


P 2 5 content 


Mined rock 
equivalent 


Phosphate, crude apatite 


13,692,603 

3,929,076 

1,523,161 

1,462,002 

459,278 

198,674 

117,509 

88,759 

43.987 

32,144 

25,269 

23,021 

20,580 


4,244,707 

1,807,375 

822,507 

672,521 

101,041 

29,801 

23,502 

62,131 

4,839 

6,429 

7,581 

3,453 

47,157 


13,692,603 


Diammonium phosphate 

Phosphoric acid, fertilizer grade 

Triple superphosphate 

Ammonium phosphate 

Mixed chemical fertilizer 


6,679,429 

2,894,006 

2,339,203 

321,495 

99,337 


Calcium phosphate 


82,256 


Phosphoric acid, thermal grade 

Sodium tnpolyphosphate 

Normal superphosphate 


204,146 
17,595 
22,501 


Phosphate chemical fertilizer 


25,269 


Other sodium phosphates 

Elemental phosphorus 


11,511 
185,220 


Total 


21,616,063 


7,833,044 


26,574,561 





Idaho, Montana, 
Utah, and Wyoming 



Florida and North Carolina 
Figure 14.— Phosphate rock sold or used by producers, by use and by geographic area, 1977. 





Tennessee 



KEY 

Agriculture 
Industrial uses 
Exports 



Table 37.— Projected income, employment, and output 
value for the Florida phosphate industry in 1981 





Florida 


Rest of 
Nation 


National 
total 


Output value, million 1977 dol- 
lars: 

Direct 


870 
490 


405 
1,000 


1,275 


Indirect 


1,490 






Total 


1,360 


1,405 


2,765 


Employment, number of jobs: 
Direct 


12,554 
10,331 
25,614 


NAp 
15,478 
44,900 


12,554 


Indirect .__ 


25,809 


Induced 


70,514 


Total 


48,499 


60,378 


108,877 


Income, million 1977 dollars: 
Direct _ 


167.3 
105.8 
174.4 


NAp 

988 

292.3 


167.3 


Indirect 

Induced - 


204.6 
466.7 


Total 


447.5 


391.0 


838.5 



Table 38.— State, local, and Federal tax revenues 

associated with the Florida phosphate industry, 

projections for 1981 

(Million 1977 dollars) 



Tax 


Florida 


Rest of 
Nation 


National 
total 


Federal and State personal income tax .__ 
Federal corporate income tax 


NAp 
NAp 
5.8 
48.5 
.3 
25.0 
20.0 


60.0 
122.6 
NAp 
NAp 
NAp 
4.4 
30.0 


60.0 
122.6 


Florida corporate income tax 


5.8 


Florida severance tax 


48.5 


Florida motor fuel tax 


.3 


State sales taxes _ _ 


29.4 


Local property taxes _-- 


50.0 


Total -- 


99.6 


217.0 


316.6 



NAp Not applicable. 



NAp Not applicable 



36 



phosphatic fertilizer operations was not economic in the past, 
but because of recent, relatively high, stable prices, fluorine 
is now economically recovered from wet-process phosphoric 
acid plants. Also, as a result of a U.S. Environmental Pro- 
tection Agency promulgation, this recovery is now required 
by law. Two large fertilizer producers in Florida, United States 
Steel Corp's. Agri-Chemical Div. and Farmland Industries, 
are supplying fluosilicic acid, a former waste product, to Alu- 
minum Can Co. of America (Alcoa) and Kaiser Aluminum and 
Chemical Corp. for the manufacture of synthetic cryolite and 
aluminum fluoride. In addition, 1 2 phosphoric acid plants sup- 



plemented domestic supplies of fluorine with about 54,431 
metric tons of fluosilicic acid in 1977, or the equivalent of 
about 90,718 metric tons of fluorspar. 

Fluosilicic acid production from Florida is expected to reach 
70,000 tons per year by 1985. Therefore, based on a value 
of $1 00 per ton of fluosilicic acid and assuming the productive 
life of the State's phosphate rock deposits to be at least 20 
years, Florida's total byproduct fluosilicic acid production would 
have a value of $140 million (in constant 1977 dollars) in 
2005. 



37 



IMPORTANCE OF PHOSPHATE FERTILIZER TO THE AGRICULTURAL SECTOR 



Phosphate fertilizers are derived from the mining and treat- 
ment of phosphate rock. Treatment of the phosphate rock 
makes the phosphate soluble and available to growing plants. 
Phosphorus is required by all living plant and animal cells. 
Consequently, soils with deficiencies of available phosphorus 
produce only limited crop yields. Although it is not required 
in large amounts, the absence or near absence of phosphorus 
is calamitous to crop growth. A handbook published by the 
fertilizer industry (70) states that phosphorus "must be pre- 
sent in adequate amounts in living cells before cell division 
will take place ... It also has many vital functions in photo- 
synthesis utilization of both sugar and starches, and in energy 
transfer processes." 

Because phosphorus is depleted from the soil as agricul- 
tural production continues, a like amount must be returned 
to the soil in order to maintain an acceptable level of pro- 
ductivity. Phosphate fertilizer must be used to replenish the 
level of phosphorus pentoxide (P 2 5 ) in the soil since there 
is no substitute for phosphorus as a plant nutrient, and sub- 
stantial quantities of soluble phosphorus are derived only 
from phosphate rock. Approximately 88 percent of all phos- 
phate rock consumed in the United States is utilized in the 
production of phosphate fertilizer. 



Use in Agriculture 

Of the phosphate rock mined in Florida that is not shipped 
directly to export markets, more than 95 percent is used to 
produce agricultural chemicals, that is, fertilizers or animal 
feed supplements. Historically, four major crops have ac- 
counted for approximately 62 percent of U.S. phosphatic fer- 
tilizer consumption; these crops are corn for grain. 12 cotton, 
soybean for beans, 12 and wheat. The use of phosphatic fer- 
tilizer for oats, barley, hay, and pasture accounts for another 
20 percent of U.S. consumption. The Corn Belt States are 
by far the largest consumers of phosphatic fertilizer in the 
United States, as previously shown in figure 7. 

CORN FOR GRAIN 

The single largest use of fertilizer in the United States is 
for growing corn. Almost 68 million acres of corn for grain 
was harvested in the United States in 1978. Approximately 
39 percent of the P 2 5 used in the United States in the 1978 
fertilizer year was used to produce corn for grain. 

In 1978 the U.S. Department of Agriculture (USDA) sur- 
veyed 1 7 States to collect data on fertilizer use for corn crops. 
The survey accounted for 91 percent of the total acreage of 
corn harvested for grain in the United States. Of the fields 
surveyed in 1978, a total of 95 percent received some fertil- 
izer; the previous year's total was 96 percent. The proportion 
of corn acreage receiving P 2 5 remained steady from 1 977 
to 1978, at 87 percent. 



12 Category used by the U.S. Department of Agriculture for the collection of 
data pertaining to fertilizer use. Corn for gram which accounts for 90 percent 
of all corn grown, is harvested only for the corn kernel, as opposed to corn 
for silage, which is harvested for use of the entire corn plant as feed. Although 
soybean is now grown exclusively for its bean, historically this has not always 
been the case. 



COTTON 

Eleven cotton producing States were surveyed by USDA 
for data on fertilizer use in 1978, and these 11 States ac- 
counted for 98 percent of the total U.S. cotton acreage that 
was harvested that year. Of the fields surveyed, 69 percent 
received some fertilizer, which was down substantially from 
the previous year's total. Harvested acreage that received 
phosphate declined about 10 percent from 1977 to 1978. 
Application rates were also lower; in 1978 the average rate 
was approximately 45 pounds of P 2 5 per acre of cotton. 

Nearly all fields harvested for cotton in the Southern States, 
where intensive cultivation over the years has depleted the 
soil of its natural nutrients, received some fertilizer in 1978. 
In Texas and Oklahoma, however, where insufficient mois- 
ture is a threat, only half the cotton acreage was fertilized. 

SOYBEANS FOR BEANS 

Sixteen States surveyed by USDA for fertilizer use on soy- 
beans for beans in 1978 accounted for 91 percent of the 
harvested soybean acreage in the United States. Harvested 
acreage receiving some fertilizer remained stable at about 
37 percent in 1977 and 1978. The proportion of soybean 
acreage receiving phosphate fertilizer was stable at about 36 
percent during the same period. Application rates for P 2 5 
averaged 45 pounds per acre in 1978, which was up slightly 
compared with application rates for recent years. 

WHEAT 

Seventeen States were surveyed by USDA for fertilizer use 
on wheat in 1978, and these 17 States accounted for 92 
percent of the total acreage harvested for wheat in the United 
States that year. Of the fields surveyed, 61 percent received 
some fertilizer, compared with 65 percent in 1977. The pro- 
portion of acreage receiving phosphate decreased in 1978. 
Applications rates on harvested acreage also decreased, from 
36 pounds of P 2 5 per acre in 1977 to 35 pounds per acre 
in 1978(33). 



U.S. Balance of Trade 



In 1 977 the U.S. balance of trade showed a deficit of $26.5 
billion. Imports of petroleum and petroleum products, valued 
at $41.5 billion, were largely responsible for this deficit, and 
the value of these imports is rapidly increasing as the world 
price of petroleum continues to rise. In recent years, however, 
gross agricultural exports have also risen steadily, from $1 7.7 
billion in 1973 to a record $23.7 billion in 1977 (table 39). 
With imports of agricultural products in the same year valued 
at $13.5 billion, the U.S. agricultural sector maintained a net 
positive balance of trade of $10.2 billion (35). The positive 
contribution of agricultural exports to the U.S. balance of 
payments is growing and is expected to continue to grow in 
the foreseeable future. 

One reason for this growth is grain imports by the U.S.S.R. 
In 1976 the U.S.S.R. agreed to purchase at least 6 million 
metric tons of grain per year from the United States, with any 
purchases beyond 8 million metric tons per year to require 
further negotiation. In 1977 the ceiling for these purchases 



38 



Table 39.— U.S. foreign trade in agricultural products 

(Billions) 



Table 41 . — Phosphorus pentoxide (P 2 5 ) taken up by 
various crops, 1976 



Year 


Exports 


Imports 


Balance 


1958 


$3.9 


$3.9 


$0 


1959 


4.0 


4.1 


-0.1 


1960 


4.9 


3.8 


1.1 


1961 


5.0 


3.7 


1.3 


1962 


5.0 


3.9 


1.1 


1963 


5.6 


4.0 


1.6 


1964 


6.3 


4.1 


2.2 


1965 


6.2 


4.1 


2.1 


1966 


6.9 


4.5 


2.4 


1967 


6.4 


4.5 


1.9 


1968 


6.2 


5.1 


1.1 


1969 


5.9 


5.1 


.8 


1970 


7.2 


5.8 


1.4 


1971 


7.7 


5.8 


1.9 


1972 


9.4 


6.5 


2.9 


1973 


17.7 


8.4 


9.2 


1974 


22.0 


10.4 


11.6 


1975 


21.9 


9.5 


12.4 


1976 


23.0 


11.2 


11.8 


1977 


23.7 


13.5 


10.2 



Source: International Economic Report of the President, January 1977 (27). 

was raised to 15 million metric tons per year. In that year the 
Soviets bought 12.7 million metric tons of U.S. grain (9.3 
million tons of corn and 3.4 million tons of wheat) valued at 
more than $1.3 billion. It was estimated that these figures 
doubled for 1978. Recent international developments have 
affected this trade, however, and it is unlikely in the short run 
that the United States will continue to export grain to the 
U.S.S.R. 

As a result of the United States' formal recognition of Main- 
land China, an agricultural products market is likely to open 
up in that country. 

A summary of the value of U.S. exports of four leading 
crops that received phosphatic fertilizers — corn, wheat, soy- 
beans, and cotton — is given in table 40 for the 1977 crop 
year. The importance of phosphatic fertilizers to the domestic 
economy and to the U.S. balance of payments is evident from 
this table. Table 40 also shows that phosphatic fertilizers were 
a necessary input for $20.5 billion worth of domestic crops, 
including $6.1 billion worth of crop exports, with both of these 
figures including only the four crops listed above. Thus, when 
the value of crops grown using phosphatic fertilizers is taken 
into account, the importance of the phosphate industry is seen 
to be far greater than it appears when only the value of 
phosphate rock and fertilizer products is considered. 

In the past, extensive research has been devoted to the 
importance of fertilizer to crop yield. It is held by many people 
that plant nutrients in fertilizers can be credited with more 
than one-third of the food production in the United States (1). 
Over the past 10 years the soil of farm lands throughout the 







Approximate 








amount 








of P 2 5 






Amount of 


taken up 






P 2 5 applied, 


by crop, 


Average yield, 




pounds 


pounds 


bushels 


Crop 


per acre 


per acre 


per acre 


Corn 


59.8 


33.0 


87.4 


Wheat 


18.6 


16.7 


30.3 


Cotton 


27.7 


12.0 


1 464.0 


Soybeans 


11.9 


20.4 


25.6 



1 Pounds per acre. 

United States has been intensively fertilized. As a result, a 
certain amount of nutrient buildup is present in the soil. Be- 
cause of this, the marginal yield of additional nutrient appli- 
cation may be low in the short run, for some crops. This is 
true regarding application of phosphate fertilizer. 

One characteristic important to the analysis of phosphate 
fertilizer yield is the residual value from applied phosphate. 
In any one year, probably not more than 20 percent of the 
phosphorous added to the soil is taken up by the crop; there- 
fore, a large percentage of phosphorus remains in the soil 
which can be used by future crops. Table 41 shows the ap- 
proximate P 2 5 content, in pounds per acre, of the 1 976 yield 
of crops as harvested from the field. As shown in the table, 
much more P 2 5 was applied to corn and cotton than was 
taken up by these crops. Soybeans, however, took up more 
P 2 5 than was applied. This is because soybeans are com- 
monly grown after corn on the same land, so soybean crops 
generally benefit from P 2 5 that has been previously applied 
for corn. Because of this, a low percentage of soybean acreage 
is fertilized (28 percent in 1976). The data presented in the 
table imply that the extra P 2 5 applied to the corn crop was 
utilized to a large degree by soybeans. 

General advances in farm technology are expected to con- 
tinue to increase crop yield responses to phosphatic fertil- 
izers. It has been estimated that farmers receive a return of 
about $2.00 for every $1 .00 spent for phosphatic fertilizers. 
In 1978 a total of 5.1 million tons of P 2 5 was used in the 
United States (2). With P 2 5 valued at 17 cents per pound, 
or $340 per ton, the cost of this P 2 5 was about $1 .7 billion. 

In recent years fertilizer has become a growing input into 
current farm operating expenses. Fertilizer comprised 6 per- 
cent of current farm operating expenses in 1960, almost 8 
percent of these expenses in 1965, and 12 percent in 1975. 
Thus, the percentage of current farm operating expenses that 
was spent on fertilizer increased by 100 percent in 15 years. 
Total current farm operating expenses increased 270 percent 
from 1960 to 1977; during this same period, fertilizer ex- 



Table 40.— Value of crop production and exports in the 1977 crop year 1 













Value of U.S. 




Value of 


Crop fertilized with 




Value of 


exports fertilized with 




U.S. 


phosphatic 


Value of U.S. crop 


U.S. 


phosphatic 




production 


fertilizer, 


fertilized with phosphatic 


exports, 


fertilizer, 


Crop 


billions 


percent of total 


fertilizer, bilions 


billions 


billions 


Corn 


$14.7 


90 


$13.3 


$3.6 


$3.3 


Wheat 


6.2 


50 


3.1 


2.0 


1.0 


Soybeans 


8.5 


28 


2.4 


3.8 


1.1 


Cotton 


3.3 


53 


1.7 


1.3 


.7 


Total ... 


32.7 


NAp 


20.5 


10.7 


6.1 



NAp Not applicable. 

1 Bureau of Mines, estimates based on U.S. Department of Agriculture preliminary information. 



39 



penses increased almost fivefold, from $1.3 billion to $5.9 
billion. About $1.7 billion of the fertilizer expense for 1977 
was for phosphate fertilizer (32). 



U.S. Exports of Phosphatic Fertilizers 



The United States is a major world supplier of phosphate 
fertilizers. In the 1977-78 fertilizer year, the United States 
exported nearly 7.3 million metric tons of P 2 5 in various 
phosphate materials, equivalent to roughly one-fourth of the 
total U.S. production. 

The five major importers of U.S. ammonium phosphate in 
1977-78 were Brazil, India, Italy, Belgium, and France. To- 
gether these five countries received 69 percent of total U.S. 
imports. Indonesia, a major importer of U.S. ammonium phos- 
phates in 1974-75, purchased none in 1975-76 because it 
had large domestic inventories. Pakistan, which imported only 
12,000 metric tons of U.S. ammonium phosphates in 1974- 
75, became a relatively large importer in 1975-76, when it 
received 184,000 metric tons. 

Eight nations imported 50,000 metric tons or more each of 
concentrated superphosphate from U.S. sources in 1977-78. 
The top four importing nations — Brazil, the Federal Republic 
of Germany, Indonesia, and Belgium — received two-thirds of 
total U.S. exports. 



World Fertilizer Situation Review and 
Prospects 

In the year ending June 30, 1 975, the world fertilizer market 
emerged from 24 months of short supplies and high prices. 
In January 1975, international prices for fertilizers were at 
high levels. New plant capacity had been insufficient to meet 
the increased demand for fertilizer which resulted from panic 
buying, widespread crop shortfalls, record high grain prices, 
and international projections indicating continued fertilizer 
shortages and rising prices. High prices for fertilizer and ex- 
pectations of lower crop prices reduced world demand, caus- 
ing inventory buildups in both importing and exporting na- 
tions. World fertilizer prices then experienced a long decline 
from the unsustainable high levels of 1974-1975 until they 
hit bottom during 1976-77. In 1977-78 seasonal fluctuations 
continued for the major fertilizer components (33). Prices 
showed more strength and stability in the 1977-78 fertilizer 
year than they had in previous years. 

It is expected that world demand for fertilizers will increase 
over the next few years, but the extent of the increase is 
uncertain (33). World production capacity for phosphate is 
expanding, and fertilizer inventories remain high in several 
major fertilizer importing countries. A recurrence of tight world 
market conditions for fertilizers seems unlikely through 1 980- 
81. The world market for phosphate fertilizers is strong. 



Phosphate Fertilizer Outlook 



In 1975 the future of the phosphate fertilizer industry did 
not look good. Domestic demand had fallen back sharply from 
1974 to 1975, and there were rumors that the U.S. export 
market was shattered. At the same time, the Nation's pro- 
ducers were in the midst of a 30-percent expansion that in- 
creased wet-process phosphoric acid capacity from 6.0 mil- 
lion metric tons per year in 1974 to 7.7 million metric tons 
per year in 1975. A glut of capacity was evident, but it was 
short-lived. 

In 1977 the export market for phosphate fertilizer made 
large advances. Net export levels had almost doubled since 
1974, and it appeared that the market had bounced back 
from the low level of 1974. Annual capacity in 1977 and 1978 
was 8.8 and 9.3 million metric tons, respectively, and was 
projected to remain at 9.3 million metric tons through 1980, 
according to U.S. Department of Agriculture estimates. If de- 
mand increases, further expansion of phosphate fertilizer 
capacity will be needed by the early 1980's to replace ob- 
solete plants and supply even larger amounts of wet-process 
phosphoric acid. 

Export markets for phosphate products have been stable. 
Phosphate rock exports have declined in recent years, but 
exports of manufactured phosphate fertilizer have grown con- 
siderably in terms of P 2 5 equivalent; the United States is 
now exporting more "value-added" materials along with its 
phosphate rock. Diammonium phosphate exports increased 
significantly in 1978, and other important phosphate products 
which showed export gains were concentrated superphos- 
phate and phosphoric acid. 

World consumption of manufactured phosphate fertilizers 
rose 4 percent in 1975-76 to an estimated 26.2 million tons 
of P 2 5 , after a drop of almost 7 percent during the previous 
year. Prices during 1975-76 declined, returning to early 1973 
levels. Recent estimates put 1976-77 world phosphate con- 
sumption at approximately 28 million metric tons of P 2 5 and 
1978-79 consumption at close to 30 million metric tons. The 
developed countries were expected to account for about 50 
percent of the 1976-77 world consumption of phosphate fer- 
tilizers, the centrally planned nations were expected to con- 
sume about 33 percent, and the developing countries about 
17 percent (34). These proportions are expected to remain 
roughly constant through 1980-81. 

The world produced 27.3 million metric tons of phosphate 
fertilizer in 1977 and consumed 26.5 million metric tons. It 
was projected in 1979 that world phosphoric acid capacity 
between 1 977 and 1 985 would increase by 30 percent. It was 
also projected that potential world production of phosphate 
fertilizers could reach 38.9 million metric tons by 1985 and 
that world consumption would reach 36.7 million metric tons. 
Based on these projections, world production can be ex- 
pected to exceed world consumption by about 2.2 million 
metric tons in 1 985. This excess would be equivalent to about 
6 percent of production. During the past 10 years, world pro- 
duction has exceeded consumption by about 5 percent (75). 



40 



WORLD PRODUCTION AND CAPACITY OF PHOSPHATE ROCK 



World Production 



World phosphate rock production (fig. 15 and table 42) 
increased by 8 percent from 1973 to 1977, reaching a level 
of 116 million metric tons in 1977. The increase in demand 
for phosphate rock was even more substantial, although an 
oversupply persisted in 1976 and 1977. The increased de- 
mand was not sufficient, however, to eliminate a buyers' market 
that had prevailed since 1975. 

By 1 977 it was clear that any attempts by Morocco and 
other African and Near Eastern suppliers to establish a cartel 
would be unsuccessful. Phosphate rock prices for the 1978 
contract year showed only a marginal improvement over the 
prices that had prevailed in 1977, and it appeared that any 
attempts by exporters to cover the costs of inflation were 
fragmentary, at best. 



World Capacity 



At the time this report was written (1980), it appeared that 
total world phosphate rock capacity for 1980 would be more 
than sufficient to meet the total world demand for that year. 
World capacity was estimated at 164 million metric tons for 
1 980, which was nearly 22 percent more than the 1 977 world 
capacity of 134 million metric tons. This increase of nearly 
22 percent implies an average annual growth rate of 7 percent. 
Continued capacity growth at this rate would be more than 
sufficient to meet the estimated growth in world demand for 



phosphate rock during the 1977-85 period; the probable 
average annual rate of demand growth for this period has 
been projected at 5.6 percent (2.5 percent for the United 
States and 5.1 percent for the rest of the world) (20). 

This situation relates directly to the Florida phosphate industry 
and its future prospects. The industry has a secure domestic 
market, and growing world demand and higher prices can be 
expected to encourage more shipments into the export market. 
With two strong and growing markets available, the Florida 
phosphate industry has flexibility should one market weaken. 
The rest of the U.S. phosphate industry, however, will be at 
a disadvantage because freight rates have doubled since 
1974, and the price of sulfur is at an alltime high. 

The existing relationship between world capacity for 
phosphate rock and world demand — which will be growing 
by at least 5 percent per year in the mid-1 980's, according 
to a World Bank forecast — depends directly upon the availability 
of sources of supply alternative to Florida. In 1977 Florida 
and North Carolina pr< duced more than 40 million metric tons 
of phosphate rock, he equivalent of one-third of world 
production (table 42); it is estimated that in 1981 production 
for Florida alone will increase to 43 million metric tons. Although 
there are substantial phosphate rock reserves outside the 
United States (table 43), these reserves would require time 
and money for development. In order to develop new capacity 
equal to that which could be lost due to depletion of reserves 
in Florida, several years and new investment would be required. 
One certain consequence of a reduction in Florida production 
would be increased fertilizer prices which would result from 
competition for restricted supplies of phosphate rock for 
domestic and export use. 




Figure 15.— World production of phosphate rock, by relative share, 1977. 



41 



Table 42.— World production of phosphate rock, by country 

(Thousand metric tons) 



Country 1 



North America: 

United States 

Mexico 

Netherlands Antilles 

South America: 

Argentina (guano) 

Brazil 

Chile (guano) ___ 

Colombia 

Peru 

Venezuela 

Europe 

France 

Germany, Federal Republic 
of 

U.S.S.R." 

Africa: 

Algeria 

Egypt 

Morocco _ ___ 

Senegal: 

Aluminum phosphate .. 
Calciumphosphate 

Seychelles (guano) 5 

South Africa. Republic of 6 . 

Spanish Sahara 

Togo 

Tunisia 

Uganda e 

Zimbabwe-Rhodesia e 

Asia: 

China, Mainland e 

Christmas Island _ 

India: 

Apatite 

Phosphate rock 

Israel 

Jordan 

Korea, North (apatite) e 

Philippines: 

Guano 

Phosphate rock 

Syria 

Vietnam e 

Oceania: 

Australia _ 

Nauru Island 

Ocean Island 



Total 



1973 



38,226 
72 
93 

1 
286 
13 
10 
23 
30 

29 

93 
21.228 

612 

533 

17,077 

219 

1.533 

7 

1,365 

697 

2,292 

3,473 

15 

150 

2,994 
1,538 

10 

135 

780 

1,106 

363 

( 2 ) 

12 

150 

499 

5 

2,323 

744 



' 98,754 



1974 



41,446 
194 
107 

( 2 ) 
'327 
19 
10 
( 3 ) 
142 

19 

85 
22,498 

'789 
507 

19,721 

406 

1,472 

7 

'1,419 

' 2,300 

2,572 

'3,810 

15 

'127 

2,994 
1,764 

12 

'434 

1,026 

'692 

399 

14 

26 

602 

1,179 

2 

2,288 

562 



'109,987 



1975 



44,285 

282 

82 

1 

406 

14 

13 

( 3 ) 

116 

18 

82 
24,131 

707 

536 

13,548 

201 
1,600 

erg 

1,647 
2,760 
1,160 
3,488 
15 
'130 

3,400 
1,392 

30 

429 

882 

1,112 

454 

126 

5 

857 

1,400 

140 

1,533 

516 



107,278 



1976 



44,662 

224 

54 



490 

16 

10 

2 

80 

18 

85 
24,222 

820 

433 

15,656 

208 

1,591 

6 

1,702 

172 

2,009 

3,301 

15 

130 

3,750 
1,032 

38 

613 

639 

1,702 

454 

2 

12 

511 

1,500 

258 
755 
417 



106,955 



1977, 



47,256 

200 

79 


605 
e 16 
"10 


139 

28 

65 
24,200 

1,055 

581 

17,027 

1,869 

6 

2,403 

232 

2,857 

3,614 

5 

140 

4,100 
1,186 

e 750 

1,232 

1,781 

500 

e 2 

«12 

425 

1,500 

485 

1,146 

416 



116,000 



e Estimated. ° Preliminary. ' Revised. 

' In addition to the countries listed, Belgium, Indonesia, and Tanzania may have continued to produce phosphate rock, and the Territory of South-West Africa 
produced guano, but output was not officially reported, and available information is inadequate for the formulation of reliable estimates of output levels. 

2 Less than Vfe unit. 

3 Revised to none. 

i Estimated by the International Superphosphate Manufacturers' Association on the basis of a marketable product averaging 34.8 percent P 2 O s . 

5 Exports. 

6 Local sales and exports of phosphate concentrate and direct-sale ore. 



Table 43.— Identified world phosphate reserves and 
resources 

(Million metric tons) 



Continent 


Reserves' 


Total identified 
resources 


North America 
South America 

Europe 

Africa 

Asia 

Oceania 


2,200 
450 

1,415 

22,180 

660 

100 


8,100 
950 
3,445 
51,450 
1,350 
2,130 


Total 2 


27,000 


67,000 



' Estimated reserves at 1 977 costs and prices. 

2 Data may not add to totals shown because of independent rounding. 



World Trade 



World trade in phosphate rock and phosphatic fertilizer is 
complex, with demand for phosphate rock and fertilizer 
interrelated. Morocco, the United States, the U.S.S.R., and 
the Pacific islands of Nauru, Banaba (Ocean Island), and 
Christmas are the principal exporters of phosphate rock. 
Western Europe, Eastern Europe, Japan, Canada, and South 
America are the major importers. Florida (including North 
Carolina) exported an estimated 40 percent of its phosphate 
as rock and fertilizer in 1977 and 1978, accounting for an 
estimated 95 percent of all U.S. exports of phosphate rock 
in those years. Exports of Florida phosphate rock are expected 



42 



Table 44.— Major phosphate rock exporters 

(Thousand metric tons) 



Exporter 



1971 



1972 



1973 



1974 



1975 



1976 



1977 1 



Morocco: 

Marketable production 
Exports 

Tunisia: 

Marketable production 
Exports 

Togo: 

Marketable production 
Exports 

U.S.S.R.: 

Marketable production 
Exports 3 

U.S. Total: 

Marketable production 
Exports 

Florida: Exports 



12,013 
1 1 ,886 

3,162 
2,410 

1,715 
1,762 

21,591 
2,145 

35,277 
11,419 
10,767 



14,971 
13,559 

3,387 
2,306 

1,928 
1,855 

22,498 
NA 

37,041 
12,464 
1 1 ,895 



17,077 
16,104 

3,473 
2,226 

2,292 
2,292 

221,228 
6,552 

38,226 
12,587 
1 1 ,863 



19,721 
18,691 

'3,810 
2,407 

2,572 
2,633 

2 22,498 
5,945 

41,437 
12,605 
12,116 



13,548 
13,105 

3,488 
1,725 

1,160 

1,174 

2 24,131 
5,807 

44,276 
11,131 
10,270 



15,656 
14,652 

3,301 
1,857 

2,009 
2,001 

2 24,222 
4,870 

44,662 
9,433 
9,013 



17,027 
15,792 

3,614 
1,898 

2,857 
2,886 

24,200 
4,243 

47,256 
13,230 
12,937 



r Revised. NA Not Available. 

1 Data from Phosphate Rock, Minerals Commodity Profile, Bureau of Mines, 1978. 

2 Estimated by the International Superphosphate Manufacturers' Association on the basis of a marketable product averaging 34.8 percent P 2 5 . 

3 To Western Europe only. 



Table 45.— Exports of phosphate rock, by destination 

(Thousand metric tons and thousand dollars) 



Destination 



1975 



Quantity 



Value 



1976 



Quantity 



Value 



1977 



Quantity 



Value 



Florida phosphate rock: 

Austria 

Belgium-Luxembourg 

Brazil 

Canada 

Chile 

Colombia 

Costa Rica 

Ecuador 

El Salvador 

France 

Germany Democratic Republic 
Germany, Federal Republic of 

India 

Iran . 

Ireland 

Italy 

Japan 

Korea, Republic of 

Mexico 

Netherlands 

Norway 

Peru 

Philippines 

Poland 

Portugal 

Romania 

Spain 

Sweden 

Switzerland 

Taiwan 

United Kingdom 

Other 



Total 2 Florida exports 

Other U.S. phosphate rock, total 3 

Grand total 2 



25 

643 

509 

2,380 

26 

44 



15 

5 

519 



534 

226 

376 



207 

1,671 

608 

950 

522 

75 

10 

131 

423 



131 

47 

63 



15 

117 

1 



10,270 
1,166 



144 

29,641 

24,270 

67,367 

1,878 

2,200 



709 

217 

19,133 



20,136 

9,655 

23,614 



8,540 

80,721 

30,538 

40,141 

18,822 

2,837 

495 

7,232 

19,662 



6,216 

1,188 

2,987 



863 

5,673 

45 



424,924 
36,629 



97 

750 

645 

1,787 



16 

11 

20 

11 

534 

16 

506 

237 

277 

23 

95 

1,375 

692 

394 

688 

55 

5 

76 

190 

4 

153 

16 

103 

24 

45 

164 

2 



4,173 

26,610 

25,655 

41,566 



573 

325 

704 

426 

16,480 

401 

14,085 

11,218 

9,349 

656 

3,157 

53,311 

30,059 

12,378 

19,852 

2,104 

184 

2,950 

6,328 

129 

4,926 

424 

3,876 

871 

1,727 

5,416 

139 



9,011 
983 



300,052 
27,358 



1 1 ,436 



461,533 



9,994 



327,410 



151 

899 

558 

2,049 



53 



10 

11 

1,051 



978 

249 

366 

23 

297 

1,479 

1,165 

566 

824 

154 

16 

100 

935 

5 

259 

142 

120 



32 

405 

(1) 



12,937 
1,077 



14,014 



4,310 

22,797 

16,500 

41 ,583 



1,626 



304 

270 

23,486 



21,895 

8,556 

12,279 

598 

7,149 

48,094 

36,344 

14,126 

18,922 

4,024 

494 

3,322 

21,151 

121 

6,590 

3,246 

3,349 



1,208 

10,187 

1 



333,891 
28,332 



362,223 



' Revised. 

1 Less than V2 unit. 

2 Data may not add to totals shown because of independent rounding. 

3 Includes coloidal and sintered matrix from Tennessee, Idaho, and Montana and soft phosphate rock. 



43 



Table 46.— International phosphate rock and fertilizer shipments from Florida, 1 1976 



Destination 



Algeria __ 

Argentina 

Australia 

Bangladesh 

Belgium-Luxembourg 

Belize 

Benin 

Bermuda _ 

Brazil 

Canada 

Canary Islands 

Chile _ 

Colombia 

Costa Rica 

Denmark 

Dominican Republic 

Ecuador 

El Salvador 

England 

Ethiopia 

France 

Germany, Federal Republic of 

Guyana 

India 

Iran 

Ireland 

Italy 

Ivory Coast 

Jamaica 

Japan 

Korea, Republic of 

Malaysia 

Martinique 

Mauritius 

Mexico 

Netherlands 

New Zealand 

Nicaragua 

Norway 

Pakistan 

Panama 

Peru 

Philippines 

Poland 

Portugal 

Romania 

Sicily 

Singapore 

South Africa, Republic of 

Spain 

Sweden 

Taiwan 

Thailand 

Trieste 

Trinidad __.. 

Turkey 

Uraguay 

Wales 

Yugoslavia 



Phosphate rock 



Total 



Quantity, 

net metric 

tons 



23,972 







761,603 







712,414 

1,091,296 





16,733 

12,053 





19,541 

10,671 

145,105 



580,719 

331,147 

1,225 

237,119 

280,195 

28,036 

71 ,884 





1,372,759 

692,460 







375,058 

1,046,482 

1,000 



55,278 



31,839 

5,490 

76,523 

218,831 

3,842 

178,841 

23,775 





16.249 

102,355 

46,758 

















8,571,053 



Percent of 
total net 
tonnage 



0.28 
NAp 
NAp 
NAp 
8.89 
NAp 
NAp 
NAp 
8.13 
12.73 
NAp 
NAp 

.20 

.14 
NAp 
NAp 

.23 

.12 
1.69 
NAp 
6.78 
3.86 

.01 
2.78 
3.27 

.33 

.84 
NAp 
NAp 
16.02 
8.08 
NAp 
NAp 
NAp 
4.38 
12.21 

.01 
NAp 

.64 
NAp 

.37 

.06 

.89 
2.55 

.04 
2.09 

.28 
NAp 
NAp 

.19 
1.19 

.55 
NAp 
NAp 
NAp 
NAp 
NAp 
NAp 
NAp 



NAp 



Value 



$1,723,751 







26,917,720 







28,349,462 

22,797,757 





572,558 

518,012 





703,633 

425,780 

4,464,650 



17,500,107 

9,986,601 

60,000 

11,217,893 

9,349,383 

1,259,883 

2,502,053 





53,203,460 

30,059,481 







12,374,600 

31,140,738 

109,995 



2,104,020 



1,163,731 

184,193 

2,949,990 

7,132,405 

129,466 

5,606,751 

654,199 





423,751 

3,875,921 

1,913,920 

















Ph sphate fertilizer 



291,386,656 



Quantity, 

net metric 

tons 



23,829 

30,616 

15,999 

31 ,828 

126,393 

1,637 

473 

78 

660,049 

90,614 

2,000 

86,610 

31,934 

21,453 

22,364 

17,861 



22,417 

2,751 

7,376 

267,049 

92,502 

941 





24,688 

263,647 

7,866 

2,880 

173,858 



6,202 

200 

2,987 



5,000 

1,499 

1,426 



249,323 







48,956 

7,199 





2,500 

3,729 

10,017 



15,347 

1,500 

97,324 

766 

25,103 

41 ,636 

4,202 

131,359 



2,687,365 



Percent of 
total net 
tonnage 



0.89 

1.14 

.59 

1.18 

4.70 

.06 

.02 

NAp 

24.56 

3.37 

.07 

3.22 

1.19 

.80 

.83 

.66 

NAp 

.83 

.10 

.27 

9.94 

3.44 

.04 

NAp 

NAp 

.92 

9.81 

2.9 

.11 

6.47 

NAp 

.23 

.01 

.11 

NAp 

.19 

.06 

.05 

NAp 

9.35 

NAp 

NAp 

NAp 

1.82 

.27 

NAp 

NAp 

.09 

.13 

.37 

NAp 

.57 

.06 

3.62 

.03 

.93 

1.55 

.16 

4.89 



NAp 



Value 



$1,348,338 

3,846,026 

2,021 ,608 

3,889,210 

12,480,527 

283,647 

57,960 

12,597 

63,480,278 

10,064,881 

204,000 

7,800,840 

3,834,648 

2,593,813 

1,883,086 

2,063,857 



2,712,992 

365,883 

412,354 

31,198,908 

9,493,903 

121,156 





1,906,913 

31,095,300 

989,552 

321 ,224 

32,072,533 



775,246 

39,600 

358,443 



409,996 

164,900 

220,326 



32,803,936 







5,338,142 

879,297 





378,520 

1,134,026 

1 ,202,062 



1,676,534 

127,469 

9,828,363 

107,586 

2,384,767 

4,655,485 

1,790,487 

12,786,017 



303,616,506 



NAp Not applicable. 

'Includes shipments from the Florida Ports of Tampa, Jacksonville, and Boca Grande, as well as the Port of Morehead City, N.C., which accounted for about 3 

pet of the total shipments. 
Source: Port of Tampa Authority. 



to increase through 1 985. Due to increases in international 
transportation costs, it is anticipated that there will be a trend 
toward the export of higher value phosphate fertilizer products. 
Total world trade in phosphate rock was approximately 38 
million metric tons in 1 977. Florida and Morocco had combined 
exports of more than 23 million metric tons, or more than 77 



percent of the total exports by major phosphate rock producers 
(table 44). Morocco, from which transportation costs to 
European markets are lower than from Florida, accounted for 
a large share of the more than 29 million metric tons of 
phosphate rock that was imported into Europe in 1 977. Florida 
sales to Europe have nonetheless been stable in the recent 



44 



4000 i- 



3000 



« 

E 

C 

o 

3 
O 



o 



2000 



1000 




Canada 
and Mexico 



Central 
America 



Figure 16. — Florida exports of phosphate rock, by destination, 1976. 



1,000 



800 - 



4) 

E 

TJ 
C 
O 

M 

3 
O 



600 



i/> 400 - 



O 
X 



200 




Canada 
and Mexico 



Central 
America 



Caribbean 



Figure 17.— Florida exports of phosphate fertilizer, by destination, 1976. 



45 



past, and Western Europe is expected to continue to be a 
viable market for Florida phosphate rock because of the 
reliability of the source and the demand for a diversified source 
of supply. 

The Soviet phosphate mining industry, with estimated 
production stabilized at 24 million metric tons for the third 
successive year in 1977 (table 44), maintained its position 
as the world's second largest producer. In that same year 
the U.S.S.R. exported more than 4 million metric tons of 
phosphate rock. 

Several of the developing nations are expanding their 
phosphate industries. North Africa, which includes Morocco, 
Algeria, Tunisia, and the Sahara Desert, has phosphate rock 
reserves estimated at more than 19.5 billion metric tons. In 
1 978 the countries of North Africa produced some 24.5 million 
metric tons of phosphate rock, reflecting a 12-percent increase 
over 1977 production. This fell short, however, of the record 



high for the region, set in 1974, when North Africa produced 
26.8 million metric tons of phosphate rock. 

Despite strong foreign competition, Florida phosphate rock 
production has maintained a position of importance throughout 
the world (table 45). Exports of Florida rock (including those 
of North Carolina) rose from almost 9 million metric tons in 
1 976 to more than 1 3 million metric tons in 1 977. Approximately 
35 percent of the 1977 exports went to Western Europe, and 
another 24 percent went to Asia, principally to Japan and the 
Republic of Korea. The balance was exported to Canada, 
Poland, and Latin America. Florida's exports of phosphate 
rock and fertilizers for 1976 are shown in table 46 and in 
figures 16 and 17. 

World phosphate rock prices reached a peak in 1974. The 
next four years saw a gradual decline of prices, but by the 
latter part of 1 978 prices started to turn up again. It is anticipated 
that phosphate rock prices will increase into the 1980s. 



46 



CONCLUSIONS 



The central Florida phosphate district is the largest phosphate 
producing region in the world. In 1978 it accounted for more 
than one-third of world production. Based on the data and 
analyses presented in this report, the following conclusions 
concerning the Florida phosphate industry were drawn: 

1 . It was projected that in 1981 the phosphate industry will 
contribute the following benefits to the Florida economy: 
approximately 48,500 jobs and nearly $1 .4 billion 13 in gross 
output, including $448 million in personal income. These 
economic benefits are generally localized where the phosphate 
rock mining and fertilizer manufacturing industry, the 

/- transportation industry, and other related industries are located; 
that is, in Polk, Hillsborough, Hamilton, and Columbia Counties. 

2. The Florida phosphate industry has a substantial impact 
on the national economy. It was projected that 60,000 jobs 
and more than $1 .4 billion in gross output, including $391 .0 
million in personal income, will be generated outside Florida 
by the Florida phosphate industry in 1981. It was further 
projected that nationwide the Florida phosphate industry will 
account for approximately 100,000 jobs and $2.8 billion of 
gross output, including $839 million in personal income, in 
1981. 

3. It was estimated that total nationwide tax payments 
generated by the phosphate industry will exceed $316 million 
in 1981, with more than $99 million of that total expected to 
be paid to Florida governments. 

4. The net positive contribution of the Florida phosphate 
industry to the U.S. balance of payments in 1 981 was estimated 
at approximately $961.8 million. 

5. If it were not for the Florida phosphate industry, the 
United States would have to import a major share of its 
phosphate requirements. The result would probably be higher 



13 AII monetary estimates in this section are in 1977 dollars. 



food prices, assuming that impo sd phosphate would be 
costlier than domestic phosphate and assuming no offsetting 
increase in agricultural productivity. Higher food prices would 
in turn result in a corresponding decline in real income and 
living standards. 

6. The Florida phosphate fertilizer industry consumes about 
50 percent of all U.S. sulfur production. It was estimated that 
in 1981 the Florida fertilizer industry will represent a $480 
million market for sulfur. 

7. The fluorine contained in phosphate rock is adequate to 
supply a major share of U.S. demand, thereby reducing fluorine 
imports proportionately. Over the productive life of Florida's 
phosphate land-pebble deposits, it was estimated that $1 40 
million worth of fluorine can be recovered. 

8. Uranium with an estimated value of $3.23 billion could 
potentially be recovered from the processing of Florida 
phosphate rock in 1981, assuming a uranium oxide (U 3 8 ) 
price of $42 per pound. This estimate was based on byproduct 
recovery of U 3 8 from phosphoric acid production. Uranium 
produced as a primary product from Florida phosphate rock 
would not be economically competitive with other uranium 
ores. 

9. Two phosphate industry impact regions were defined in 
Florida, the central Florida region of Polk and Hillsborough 
Counties and the northern Florida region of Hamilton and 
Columbia Counties. Total 1 977 wages and salaries of over 
$41 9 million were attributable to the industry in central Florida. 
In the northern Florida region, approximately $40.7 million 
was linked to the industry. An estimated 13 percent of the 
central Florida region's wages and salaries and 40 percent 
of the northern Florida region's wages and salaries were 
related to the phosphate industry. Approximately 8 percent 
of the central Florida region's employment was linked to the 
phosphate industry, and 21 percent of the employment in the 
northern Florida region was linked to the phosphate industry. 



47 



BIBLIOGRAPHY 



1. Allaway, W. H. The Effect of Soils and Fertilizers on Human 
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2. Andrilenas, P. Private communication, 1978, U.S. Department 
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3. Blakely, A. F. The Florida Phosphate Industry: A History of the 
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4. Booz, Allen & Hamilton. Economic Impact Assessment of the 
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5. . Marketing and Economic Study of the Port of Tampa. 

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7. CONSAD Research Corp. Forecast of Developments in Do- 
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9. Executive Office of the President. International Economic Report 
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Internat. Econ. Rept., January 1977, 194 pp. 

10. Fertilizer Institute. The Fertilizer Handbook. Washington, D.C, 
2d ed. 1976, 208 pp. 

11. Florida State Senate. Florida Tax Handbook, 1978. Finance, 
Taxation, and Claims Committee, Tallahassee, Fla., February 1978, 
110 pp. 

12. Hargett, N. L. Fertilizer Summary Data, 1976. Tennessee Val- 
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Ala., Bull. Y-112, March 1977, 132 pp. 

13. Harre,. E. A., M. N. Goodson, and J. D. Bridges. Fertilizer 
Trends 1976. Tennessee Valley Authority, Muscle Shoals, Ala., Bull. 
Y-111, March 1977, 44 pp. 

14. Hendry, C. W., K. H. Mackay, P. Frank, S. Hall, T. E. Holcom, 
and N. Reed. Phosphate Land Reclamation Study Commission Re- 
port on Phosphate Mining and Reclamation. Rept. to the Governor, 
Tallahassee, Fla., 1978, 203 pp. 

15. International Fertilizer Development Center and National Fer- 
tilizer Development Center. World Fertilizer Situation and Outlook — 
1978-85. Tech. Bull. IFDC-T-13, March 1979, 27 pp. 

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17. Lofting, E. M., and H. C. Davis. State Input-Output Tables for 
1972 Emphasizing the Mineral Industries: Arizona, Florida, and Wis- 



consin. Dry Lands Research Institute, University of California at Riv- 
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August 1978, 27 pp. 

19. Richardson, H. W. Input-Output and Regional Economics. 
Halsted Press, Great Britain, 1972, 294 pp. 

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J0377000, June 1978, 200 pp. 



48 



APPENDIX A.— METHODOLOGY OF IMPACT ANALYSIS 



Input-output (l-O) analysis is concerned with the interde- 
pendence among economic sectors. In this study, two 1-0 
models were developed for economic impact analysis with 
respect to the Florida phosphate industry. The two models 
were based upon the economy of Florida and the national 
economy of the United States. 

The Florida phosphate industry includes the Standard In- 
dustrial Classifications (SIC's) 1475, phosphate rock mining 
and beneficiation; 2874, phosphatic fertilizer manufacturing; 
and 2819, industrial inorganic chemicals (not elsewhere clas- 
sified). These SIC's were used in constructing the two pre- 
viously mentioned l-O models, and it was from these SIC's 
that the economic impact multipliers used in this study were 
derived. In the sources of available data, all three SIC sectors 
are treated as individual industries. Because of disaggre- 
gation problems, it was assumed for purposes of this study 
that SIC 287, agricultural chemicals, is representative of SIC 
2874 for multiplier derivation purposes. 

The following is a description of impact multipliers taken 
from "The Input-Output Structure of the U.S. Mineral Indus- 
tries: Transactions, Employment, and Multipliers," a report 
written by H. C. Davis and E. M. Lofting (8) under contract 
to the Bureau of Mines: 

Economic Multiplier Analysis 

The theory and application of multiplier analysis has been 
dealt with comprehensively by Miernyk (1 ), 1 Richardson (2), 
and Moore and Petersen (3). Brief coverage of the concepts 
is presented here to provide an orientation. 

In general, the analyst seeks to determine the repercus- 
sions in terms of employment and income of various ex- 
penditures made in the economy. Prior to the development 
of input-output tables attempts were made to estimate mul- 
tiplier effects in an aggregate manner for the entire econ- 
omy. The earliest efforts are usually traced to Kahn (4) and 
Keynes (5). 

With the advent of input-output techniques, multiplier 
analysis could be carried out for individual sectors of an 
economy in a more refined fashion. Since the Leontief in- 
verse of the table of interindustry flows provides the direct 
and indirect (total) requirements by sector, per unit of output 
of final demand, the inverse can readily be used to deter- 
mine the overall impacts that changes in expenditure levels 
can cause. 

Multipliers can be calculated in different ways to serve 
different purposes. The most commonly encountered mul- 
tipliers are (i) output multipliers, (ii) employment multipliers, 
and (iii) income multipliers. Employment and income mul- 
tipliers can be calculated so as to show direct plus indirect 
effects (Type I) or direct plus indirect plus induced effects 
(Type II). The Type I and Type II multipliers are treated in 
subsection (iv). 

(i) Output Multipliers 

Output (or column) multipliers measure the total direct 
and indirect requirements needed from all sectors to deliver 
one unit of output from a given sector to final use. These 
multipliers are calculated by summing the entries in the 
columns of the Leontief inverse, hence the alternate des- 
ignation "column" multipliers. The output multipliers meas- 
ure the total requirements per unit of final demand, and thus 
indicate the degree of structural dependence of each sector 
on all other sectors of the economy. A critically important 
concept regarding this type of multiplier should be stressed. 



As normally calculated, the output multiplier represents 
total requirements per unit change in final demand. In many 
analyses the problems as posed involve the calculation not 
of changes in final demand but of direct changes in output, 
i.e., plant closings, port shutdowns, resource constraints, 
(e.g. such as droughts or other disasters) which directly 
impact on the industrial output of certain regional sectors 
without fundamentally altering the level of final demand. In 
fact, final demand may be satisfied by alternative supply 
sources. In these instances the appropriate impact multi- 
pliers are related to the unit change in output and are cal- 
culated by dividing each element in the columns of the 
Leontief inverse by the on-diagonal entry of the particular 
column. (6) The resulting matrix will have elements some- 
what smaller than those of the original Leontief inverse and 
these multipliers (the column sums of this matrix) will con- 
sequently also be smaller than those derived on the basis 
of output to final use. 

(ii) Employment Multipliers 

In many instances changes in expenditure patterns will 
increase or decrease levels of employment. Input-output 
analysis provides the means to quantify these changes on 
a sector by sector basis. 

The Bureau of Labor Statistics typically develops labor, 
or employment interactions matrices, based on the BEA 
national input-output tables. 

"In order to make the . . . input-output table more 
useful for manpower analysis, the Division of Eco- , 
nomic Growth has converted the inverse form of 
the table into manpower requirements. The original 
table, which shows the direct and indirect industry 
output generated by a dollar's worth of final de- 
mand, has been used, along with estimates of 
. . . levels of labor productivity ... to provide es- 
timates of the direct and indirect employment re- 
quirements per billion dollars of final demand . . . 
The basic input-output relationships were left un- 
changed" (7). 
The calculations of "estimates of labor productivity" are 
based on the employment-production function approach 
using linear regression methods. This technique was elab- 
orated by Moore and Petersen (8). The functions take the 
form of 

E< = rrijX, + c, 

where E is employment in man-years, x is output in constant 
dollars over the time span of available data, and c is the 
intercept value. 

The employment multipliers can be calculated by multi- 
plying each row element (b„) in the Leontief inverse by the 
appropriate (m,) to form a manpower requirements matrix. 
The columns of this matrix are then summed as in the 
development of output multipliers described above. The 
employment multiplier (E m ) is formed by dividing this column 
sum for each sector (i) by the initial (m,). 

(iii) Income Multipliers 

The simple income multiplier expresses the ratio of the 
direct plus indirect income change in a given sector to the 
initial direct change: 



M, = 



Sa^b, 



'These references are listed at the end of this quoted material. 



Where M, is the income multiplier, b„ is an element of the 
Leontief inverse, and a h| is the element of the household 
row. 



49 






(iv) Type I and Type II— Employment and Income Multipliers 

The employment and income multipliers described above 
in sections (ii) and (iii) are designed to measure the direct 
and indirect effects that result from a change in some given 
level of spending. As the income from the initial stimulus 
is respent on other goods and services, there are further 
changes in income. These second, and succeeding, round 
effects are referred to as "induced" effects. Multipliers which 
are designed to estimate the direct plus indirect effects are 
termed Type I or "simple" multipliers. Those which are 
formed to estimate direct plus indirect plus induced effects 
are called Type II multipliers. Type II multipliers can be 
estimated either by applying appropriate sectoral con- 
sumption functions to the economy under study and cal- 
culating the accretions to income from the second and suc- 
ceeding rounds of expenditures, or, by partially "closing" 
the input-output model. This closing is achieved by aug- 
menting the processing sectors with the household row and 
household column and forming a new Leontief inverse. The 
elements of the new inverse are slightly larger and provide 
the basis for calculating the Type II multipliers. 

In the case of Type I and Type II income multipliers, it 
has been noticed that for a given economy the two multi- 
pliers will always differ by a constant factor which is the 
same for all sectors. This factor appears to range generally 
between one and three. 

References 2 

I.William H. Miernyk, The Elements 
of Input-Output Analysis, Random House 
Inc., New York, 1965. 

2. Harry W. Richardson, Input-Output 
and Regional Economics, John Wiley 
and Sons, New York, 1972. 

3. F. T. Moore and J. W. Petersen, 
"Regional Analysis: An Interindustry 
Model of Utah," Review of Economics 



zjhts reference list applies only to the preceding quoted material. 



and Statistics, Vol. 37, No. 4, pp. 368-383. 

4. R. F. Kahn, "The Relation of Home 
Investment to Unemployment," Eco- 
nomic Journal, Vol. LI, 1931, p. 173. 

5. J. M. Keynes, The General Theory 
of Employment, Interest, and Money, 
Harcourt Brace, New York, 1956. 

6. Philip M. Ritz, Chief, Interindustry 
Economics, Bureau of Economic Analy- 
sis, unpublished memorandum. 

7. Jack Alterman, "The Federal Gov- 
ernment's Program of Economic Growth 
Studies," Seventh Annual Forecasting 
Conference, American Statistical Asso- 
ciation, New York, 1965. 

8. Moore and Petersen, op. cit. 

Using the above methodology, two sets of multipliers were 
calculated. The first set, which is shown in table A-1 , included 
the national impact multipliers derived from a 404-sector l-O 
table which included an expanded 44-sector mining industry. 
Table A-1 can be read as follows: The employment multiplier 
per million dollars of output of phosphate rock is equal to the 
direct employment (16.39216), in workers per million dollars 
of output, plus the net indirect employment (45.89812 - 
16.39216), plus the net induced employment (132.58181 
- 45.89812). 

The type I multiplier equals the ratio of the indirect em- 
ployment to the direct employment, and the type II multiplier 
equals the ratio of the induced employment to the direct em- 
ployment. The output multiplier is the sum of the column of 
the phosphate rock mining industry in the Leontief inverse, 
or the (l-A) - \ where I is the identity matrix and A is the direct- 
input coefficients matrix derived from the total requirements 
table. 

The personal income multipliers in both tables and the 
employment multipliers in table A-2 have solutions that are 
analogous to the solution used to compute the employment 
multipliers for table A-1. 



Table A-1. — Impact multipliers derived from a 404-sector national input-output (l-O) table for 1972 

(Per million dollars of output) 





Direct 


Indirect 


Induced 


Multiplier 


Phosphate subindustry 


Type I 


Type II 


Output 


Employment: 

Phosphate rock 


16.39216 
11.15755 
14.78383 

.28913 
.22821 
.21212 


45.89812 
34.55027 
50.30041 

.55016 
.45868 
.56765 


132.58181 
104.25907 
139.29741 

1.24334 
1.01173 
1 .27881 


2.80000 
3.09658 
3.40239 

1 .90280 
2.00985 
2.67615 


8.08812 
9.34426 
9.42228 

4.30023 
4.43326 
6.02883 


1.9616 


Industrial chemicals 

Fertilizers 


1 .9506 
2.3753 


Personal income: 

Phosphate rock __ 


1.9616 


Industrial chemicals .__ 

Fertilizers 


1 .9506 
2.3753 



Table A-2. — Impact multipliers derived from a 338-sector Florida l-O table for 1972 

(Per million dollars of output) 





Direct 


Indirect 


Induced 


Multiplier 


Phosphate subindustry 


Type I 


Type II 


Output 


Employment: 

Phosphate rock 


18.72889 
1 1 79977 
19.72519 

.34728 
.24005 
.22312 


35.28923 
21.35656 
34.33481 

.53532 
.34559 
.39505 


78.82812 
49.39388 
66.42918 

.87726 
.56553 
.64704 


1.88421 
1.80991 
1 .74066 

1.54144 
1.43963 
1 .77057 


4.20891 
4.18600 
3.36773 

2.52606 
2.35585 
2.89998 


1.5440 


Industrial chemicals 

Fertilizers 

Personal income: 

Phosphate rock 


1.3338 
1 .5738 

1.5440 


Industrial chemicals 

Fertilizers _. 


1.3338 
1.5738 



50 



APPENDIX B.— DIRECT IMPACT OF THE FLORIDA PHOSPHATE COMPLEX ON 

FLORIDA AND THE UNITED STATES 



The direct impact of the Florida phosphate complex on the 
U.S. economy can be measured by the input coefficients, or 
input requirements, given in tables B-1 , B-2, and B-3. The 
input coefficients were obtained by dividing the 1976 dollar 
value of specific industry purchases by the 1976 dollar value 
of production. This was done for all purchases at the two- 
digit Standard Industrial Classification (SIC) level for each of 
the three sectors of the phosphate complex. Thus the input 
coefficients show the distribution of inputs for each dollar of 
production. For example, in the mining sector about $0.0004 
cents out of every dollar of output represented purchases of 
lumber and wood products. All of the purchased inputs shown 
in table B-1 amount to approximately $0.58. The residual 
amount of about $0.42 includes profits and other items not 
specified in the table. 

The National Impact 

MINING SECTOR PURCHASES 

The Florida and North Carolina mining sector produced 
approximately 37,697,000 metric tons of bulk phosphate val- 
ued at $867,090,000 in 1976, according to a Bureau of Mines 
estimate. These figures represent a unit price of $23 per 
metric ton of marketable production. Almost all of this pro- 
duction occurred in central Florida. 

The pricing of marketable phosphate rock production varies 
greatly, depending on the end use of the phosphate. Over 
20 percent of Florida's production is exported from the Ports 
of Tampa, Boca Grande, and Jacksonville. The price per 
metric ton of high-grade (75 bone phosphate of lime) phos- 
phate rock exported from the Port of Tampa in 1976 was 
$34. In contrast, the average cost of production of a metric 



ton of phosphate rock (wet) at the mine was estimated for 
Florida severance tax purposes to be $10.85. Because of the 
great variation in the unit price of marketable phosphate as 
reported by the industry, all Florida production was valued at 
the 1976 national average unit price of $21 .25 per metric ton 
(f.o.b. plant) for the purpose of computing the input coeffi- 
cients shown in tables B-1 , B-2, and B-3. This price is higher, 
on the average, than the transfer price established by most 
Florida mining operations for internal transfers. Most of Flor- 
ida's marketable phosphate rock is used in Florida in inter- 
grated chemical production facilities. Most phosphate pro- 
duced and used in the State is not sold through organized 
markets. 

Table B-1 underscores the effect of using a national av- 
erage price to value Florida's phosphate production. The higher 
price results in a residual of over $0.42 per dollar of output. 
Nonetheless, the relative importance of purchased inputs can 
be effectively shown using data based on the national av- 
erage unit price rather than the transfer price reported by the 
industry. 

The most important mining sector input in 1976 was con- 
tract work and services, as shown in table B-1 . This input 
amounted to about $0.14 out of every dollar of mining pro- 
duction. A comparison of this and other inputs shown in tables 
B-1 , B-2, and B-3 suggests that production requirements 
for the mining sector are quite different from those of other 
sectors in the complex. 

Labor costs, including fringe benefits, were the next most 
important expenditure item in the mining sector, amounting 
to about 10 percent of the value of production. The relatively 
low labor cost in the phosphate mining sector reflects the 
high level of capital intensity in this sector. 

Electric utility services were also important purchased in- 



Table B-1.— Estimated input requirements as a percentage of total production for the phosphate mining sector of 

the Florida phosphate complex, 1976 1 



NAp Not applicable. 

' Based on data gathered through a Bureau of Mines survey and interviews by Florida State University personnel 

2 Standard Industrial Classification. 

3 Input requirements were computed by dividing the 1976 dollar value of input purchases by the 1976 dollar value of production. 
Adjusted to reflect known industrial structure in Florida. 





SIC 2 


Input 
requirement 3 


Inputs originating 
in Florida, 
estimated percent- 
age 


Lusiber and wood products 


24 

28 

29 

30 

33 

34 

35 

36 

37 

NAp 

4911 

4924 

NAp 

NAp 

NAp 

NAp 

NAp 

NAp 


0.0004 
.0401 
.0010 
.0006 
.0114 
.0098 
.0443 
.0156 
.0019 
.0431 
.0879 
.0051 
.1441 
.0977 
.0191 
.0281 
.0290 
.4208 


100 

46 

4 

80 

63 

91 

45 

80 

68 

69 

100 

100 

89 

100 

100 

100 

100 

NAp 


Chemicals and allied products 


Petroleum refining and related industries 


Rubber and miscellaneous plastic products 
Primary metal industries 


Fabricated metal products 


Machinery, except electrical ... 


Electrical and electronic machines 


Transportation equipment . 


Other supplies and parts 
Electric services 


Natural gas distribution . 


Contract work and services 
Labor 


Sales tax 


Property tax 


Severance tax . 


Residual 




Total 




1 .0000 


NAp 



51 

Table B-2.— Estimated input requirements as a percentage of total production for the phosphatic fertilizers sector 

of the Florida phosphate complex, 1976 1 





SIC 2 


Input 
requirement 3 


Inputs originating 
in Florida, 
estimated percent- 
age 


Phosphate rock 


1475 

1477 

26 

28 

29 

30 

32 

33 

34 

35 

36 

37 

NAp 

4911 

4924 

NAp 

NAp 

NAp 

NAp 

NAp 


"0.1765 
.2119 
.0003 
.0935 
.0171 
.0021 
.0006 
.0034 
.0096 
.0171 
.0049 
.0005 
.0595 
.0427 
.0044 
.0284 
.1080 
.0272 
.0137 
.1786 


100 


Sulfur 

Paper and allied products 
Chemicals and allied products 

Petroleum refining and related industries 

Rubber and miscellaneous plastic products 

Stone, clay, glass, and concrete products 

Primary metal industries 

Fabricated metal products __ 


5 
95 
52 

96 
70 
75 
91 


Machinery, except electrical __ 


66 


Electrical and electronic machinery 

Transportation equipment 


86 

100 


Other supplies and parts 


13 


Electric services 


100 


Natural gas distribution ._. 


100 


Contract work and services _ 


93 


Labor 

Sales tax 


100 
100 


Property tax 

Residual 


100 
NAp 


Total 




1 .0000 


NAp 







NAp Not applicable. 

1 Based on data gathered through a Bureau of Mines survey and interviews by Florida State University personnel. 

2 Standard Industrial Classification. 

3 Input requirements were computed by dividing the 1976 dollar value of input purchases by the 1976 dollar value of production. 

4 This represents a unit price for phosphate rock that is below the market price. 

5 Adjusted to reflect known industrial structure in Florida. 



Table B-3. — Estimated input requirements as a percentage of total production for the industrial chemicals sector 

of the Florida phosphate complex, 1976 1 





SIC 2 


Input 
requirement 3 


Inputs originating 
in Florida, 
estimated percent- 
age 


Phosphate rock 


1475 

1446 

24 

26 

28 

29 

30 

33 

34 

35 

36 

37 

NAp 

4911 

4924 

NAp 

NAp 

NAp 

NAp 


0.1801 
.0066 
.0007 
.0002 
.0012 
.0170 
.0022 
.1462 
.0030 
.0095 
.0264 
.0005 
.0877 
.2111 
.0133 
.0092 
.1191 
.0050 
.1610 


100 


Silica 





Lumber and wood products, except furniture 
Paper and allied products 


100 
100 


Chemicals and allied products 





Petroleum refining and related industries 

Rubber and miscellaneous plastic products 

Primary metal industries 

Fabricated metal products 


4 
5 




Machinery, except electrical 


3 


Electrical and electronic machinery 

Transportation equipment ___ 


100 



Other supplies 

Electric services 


NAp 
100 


Natural gas distribution _ 

Contract work and services 

Labor 

Sales tax 


100 
100 
100 
100 


Residual 


NAp 


Total 




1 .0000 


NAp 



NAp Not applicable. 

1 Based on data gathered through a Bureau of Mines survey and interviews by Florida State University personnel. 

2 Standard Industrial Classification. 

3 Input requirements were computed by dividing the 1976 dollar value of input purchases by the 1976 dollar value of production. 
* Adjusted to reflect known industrial structure in Florida. 



52 



Table B-4. — Production by the Florida fertilizer chemicals sector and estimated value, 1976 



Subsector 


Quantity, thousand 
metric tons 


Value, 
thousands 


Unit price 


Sulfuric acid 


'223 
1 1,382 
2,990 


$7,405 
286,004 
310,285 


2 $33.18 


Phosphoric acid 


3 207.00 


Superphosphates and other phosphatic fertilizer materials including diammonium phosphate 


3 1 03.77 


Total 




603,694 


NAp 









NAp Not applicable. 

1 Figure is for interfirm shipments, rather than actual production, since product is primarily used internally. 

2 Based on Florida shipments. 

3 Based on national shipments. 

Source: U.S. Department of Commerce, Bureau of the Census, and personal interviews. 



puts in this sector. Electricity accounted for about $0.09 out 
of every dollar of output. Despite the large volumes of elec- 
tricity purchased, there were no self-generators of electricity 
in the sector; all electricity was purchased from public utilities. 
Other significant inputs in the mining sector were chemical 
and allied products, machinery, and inputs from the primary 
metals industries. The sector also paid significant State and 
local taxes. Severance, sales, and property taxes amounted 
to approximately $0,075 per dollar of mining sector output in 
1976. This does not include the payment of a small State 
corporate income tax. 

PHOSPHATIC FERTILIZERS SECTOR 
PURCHASES 

The phosphate fertilizers sector is the most important proc- 
essing sector of the Florida phosphate complex. The major 
fertilizer chemicals produced by this sector are sulfuric acid, 
phosphoric acid, diammonium phosphate, superphosphates, 
and other phosphatic fertilizer materials. The value of total 
interplant marketed production by Florida facilities in 1976 
was estimated to be $603,700,000 (table B-4). 

The Florida phosphatic fertilizers sector is a major producer 
of sulfuric and phosphoric acid. However, a large portion of 



this production is used internally in the production of phos- 
phatic fertilizers. The estimate of $603,700,000 represents 
marketable production not used in further processing in the 
phosphatic fertilizers sector and therefore understates the 
actual physical output of some of the products of this sector. 

The superphosphates, diammonium phosphates, and other 
phosphatic fertilizer materials represent final products of the 
sector. Production of these products results in either interfirm 
shipments or inventory accumulation. It should be empha- 
sized that the figures given in table B-4 for sulfuric and phos- 
phoric acid represent only interfirm movements of these prod- 
ucts. Sulfuric acid and phosphoric acid used on an interfirm 
basis are intermediate products, and the value of these in- 
termediate products is represented in the price of the final 
products (superphosphates, diammonium phosphates, and 
other fertilizer materials). 

The importance of various purchased inputs relative to the 
marketed production of the phosphatic fertilizers sector is 
apparent from table B-2. Raw material inputs in the form of 
phosphate rock, ammonia, and sulfur accounted for about 
$0.48 out of every dollar of fertilizer chemical output in 1976. 
This figure, however, understates the actual value of raw 
materials purchased by the sector because the transfer price 
of phosphate rock is less than its market price. For purposes 



Table B-5. — Estimated value of purchases (total and Florida only) by the phosphate mining sector of the Florida 

phosphate complex, 1976 1 2 





SIC 3 


Value of all 
purchases," 
thousands 


Value of Florida 
purchases, 
thousands 


Lumber and wood products ___ 


24 

28 

29 

30 

33 

34 

35 

36 

37 

NAp 

4911 

4924 

NAp 

NAp 

NAp 

NAp 

NAp 


$304.6 

30,538.5 

761.6 

456.9 

8,681.8 

7,463.3 

33,737.1 

11,880.3 

1,447.0 

32,823.2 

66,941.1 

3,884.0 

109,740.8 

74,404.4 

14,545.8 

21 ,399.8 

22,085.2 


$304.6 


Chemicals and allied products 


14,047.7 


Petroleum refining and related industries 





Rubber and miscellaneous plastic products 

Primary metal products 


365.5 
5,469.5 


Fabricated metal products 


6,719.6 


Machinery, except electrical 


15,181.7 


Electrical and electronic machinery 

Transportation equipment __ 


9,504.2 
984.0 


Other Supplies and parts 

Electrical service 

Natural gas distribution 

Contract work and services ... 

Labor 

Sales tax 


22,648.0 
66,941.1 
3,884.0 
97,669.3 
74,404.4 
14,545.8 


Property tax 

Severence tax 


21,399.8 
22.085.2 






Total 




441,095.6 


376,226.4 









NAp Not applicable. 

1 Based on data gathered through a Bureau of Mines survey and interviews by Florida State University personnel. 

2 The estimates presented are based on an output value of $761 ,560,000 for the Florida mining sector. This value represents 35.8 million metric tons of phosphate 

rock production valued at $21 .25 per metric ton. 

3 Standard Industrial Classification. 

4 The total value of purchases from each industry (or labor purchased, or tax paid, where applicable) was obtained by multiplying the applicable input requirements 

per unit of output by the estimated value of mining output for Florida ($761,560,000). 






of internal accounting, fertilizer chemical establishments un- 
derprice phosphate rock when estimating the cost of raw 
materials in their product in process. 

Labor costs, including fringe benefits, amounted to about 
$0.1 1 out of each dollar of output. As was the case with the 
mining sector, this indicates a very capital-intensive produc- 
tion process. 

Other important inputs in the phosphatic fertilizers sector 
include chemicals and allied products, electric services, and 
contract work and services. The sales tax collections and 
property tax payments of this sector amounted to over $0.04 
for every dollar of output. 

INDUSTRIAL CHEMICALS SECTOR PURCHASES 

The industrial chemicals sector of the Florida phosphate 
complex is relatively insignificant compared to the mining and 
fertilizer sectors. The basic output of this sector is elemental 
phosphorus, which is used in a wide variety of industrial ac- 
tivities. 

The primary input requirements in the industrial chemicals 
sector are phosphate rock, coke, electric services, and labor, 
as shown in table B-3. The most important input, electric 
services, accounted for about $0.21 out of every dollar of 
production, making this sector the most energy-intensive sec- 
tor of the complex. However, none of the Florida firms making 
up the industrial chemicals sector were self-generators of 
electricity. The industrial chemical sector, like the other two 
sectors, uses capital-intensive production processes. 

Impact on Florida 

MINING SECTOR PURCHASES 

A very large percentage of phosphate mining sector pur- 
chases, as shown in tables B-1 and B-5, are obtained from 



53 



Florida producers. Only one major input, petroleum products, 
is purchased exclusively outsid" the State. This does not 
mean that the mining sector does not purchase petroleum 
products from Florida jobbers and wholesalers, but rather that 
the petroleum products it purchases are not manufactured in 
the State. With this one exception, the impact of the phos- 
phate mining sector is very significant for the economy of 
Florida. More than 85 percent of the value of the mining 
sector's 1976 purchases, as estimated in table B-5, were 
purchased from manufacturers in Florida. Including taxes and 
labor, these purchases amounted to about $376,226,000. 

The significant mining sector inputs representing products 
bought from Florida firms are contract work and services and 
electrical services. These inputs were estimated at approxi- 
mately $97,669,000 and $66,941,000, respectively, in 1976. 
In addition, wage payments by the mining industry have a 
significant impact on the central Florida region. 



PHOSPHATIC FERTILIZERS SECTOR 
PURCHASES 

The phosphatic fertilizers sector of the Florida phosphate 
complex has a relatively smaller impact on the Florida econ- 
omy than does the mining sector. This is because the fertilizer 
sector obtains all of its sulfur and anhydrous ammonia, which 
are major purchased inputs for this sector, from sources out- 
side the State. Sulfur, obtained primarily from the Gulf Coast 
area and Mexico, is used to produce sulfuric acid, which is 
consumed internally in the production of fertilizer chemicals. 
Anhydrous ammonia is used to make most of the solid forms 
of nitrogenous fertilizers. 

Approximately 60 percent of all the sector's purchases were 
made in Florida in 1976, based on the data given in table B- 
6. The estimated value of these purchases was about 
$292,957,000. The most significant purchase was phosphate 



Table B-6.— Estimated value of purchases (total and Florida only) by the fertilizer chemcials sector of the Florida 

phosphate complex, 1976 1 2 





SIC 3 


Value of all 
purchases, 4 
thousands 


Value of Florida 
purchases, 
thousands 


Phosphate rock 


1475 

1477 

26 

28 

29 

30 

32 

33 

34 

35 

36 

37 

NAp 

4911 

4924 

NAp 

NAp 

NAp 

NAp 


$106,552.0 

127,922.8 

181.1 

56,445.4 

10,323.2 

1 ,267.8 

362.2 

2,052.6 

5,795.5 

10,323.2 

2,958.1 

301.8 

35,919.8 

25,777.7 

2,656.3 

17,144.9 

65,199.0 

16,420.5 

8,270.6 


$106,552.0 


Sulfur 

Paper and allied products 



172.0 


Chemicals and allied products 5 

Petroleum refining and related industries 


29,351.6 



Rubber and miscellaneous plastic products 

Stone, clay, glass, and concrete products 

Primary metal industries 


1,217.1 

253.5 

1,539.4 


Fabricated metal products 

Machinery, except electrical 


5,273.9 
6,813.3 


Electrical and electronic machinery 

Transportation equipment 


2,544.0 
301.8 


Other supplies and parts 

Electric services 

Natural gas distribution 

Contract work and services 

Labor 

Sales tax 


4,669.6 
25,777.7 

2.656.3 
15,944.8 
65,199.0 
16,420.5 


Property tax 


8,270.6 


Total 




495,874.5 


292,957.1 



NAp Not applicable. 

1 Based on data gathered through a Bureau of Mines survey and interviews by Florida State University personnel. 

2 The estimates presented are based on an output value of $603,694,000 for the Florida fertilizer chemicals sector. This output value was estimated from U.S. 

Department of Commerce, Bureau of the Census, data. 

3 Standard Industrial Classification. 

4 The total value of purchases from each industry (or labor purchased, or tax paid, where applicable) was obtained by multiplying the applicable input requirement 

per unit of output by the estimated value of fertilizer chemicals output for Florida ($603,694,000). 

5 A major item in this category is ammonia. 



54 



Table B-7. 



-Estimated value of purchases (total and Florida only) by the industrial chemicals sector of the Florida 

phosphate complex, 1976 1 2 





SIC 3 


Value of all 
purchases," 
thousands 


Value of Florida 
purchases, 
thousands 


Phosphate rock 


1475 

1466 

24 

26 

28 

29 

30 

33 

34 

35 

36 

37 

NAp 

4911 

4924 

NAp 

NAp 

NAp 

NAp 


$4,654.6 

170.6 

18.1 

5.2 

31.0 

439.4 

56.9 

3,778.5 

77.5 

245.5 

682.3 

12.9 

2,266.6 

5,455.8 

343.8 

237.8 

3,078.1 

129.2 

2,620.7 


$4,654.6 


Silica 

Lumber and wood products, except furniture 
Paper and allied products 




18.1 

5.2 


Chemicals and allied products 





Petroleum refining and related Industries .. 





Rubber and Miscellaneous plastic products 

Primary metal industries ... 

Fabricated metal products . ... 


2.8 





Machinery, except electrical 

Electrical and electronic machinery 


7.4 
682.3 


Transportation equipment 





Other supplies 

Electrical supplies 

Natural gas distribution 

Contract work and services 

Labor 

Sales tax .. .. _ 


NA 

5,455.8 

343.8 

237.8 

3,078.1 

129.2 


Residual 





Total 




24,304.5 


14,615.1 









NA Not available. NAp Not applicable. 

1 Based on data gathered through a Bureau of Mines survey and interviews by Florida State University personnel. 

2 The estimates presented are based on an output value of $25,844,450 for the Florida industrial chemicals sector. This value was estimated from wage and 

salary data for the sector. 

3 Standard Industrial Classification. 

4 The total value of purchases for each industry (or labor purchased, or tax paid, where applicable) was obtained by multiplying the applicable input requirement 

per unit of output by the estimated value of industrial chemicals output for Florida ($603,694,000). 



rock, which was valued at $106,552,000. Altogether, 
$29,352,000 worth of chemical products were purchased from 
Florida manufacturers as inputs to the phosphatic fertilizers 
sector. This was over half the value of all chemicals pur- 
chased as inputs by the sector. The sector purchased about 
$25,777,000 worth of electricity in Florida in 1976, reflecting 
its extensive use of electrical machinery. 

Wage and salary payments to Florida residents were es- 
timated at approximately $65,199,000. 

INDUSTRIAL CHEMICALS SECTOR PURCHASES 

The industrial chemicals sector has the smallest impact on 
the State of any of the three sectors studied. The value of 
total Florida output from th ; s sector was estimated at 
$25,844,450 for 1976, with elemental phosphorus accounting 
for most of the sector's production and sales. About 60 per- 
cent of the sector's purchases originated in Florida in 1976, 
as indicated by the data in table B-7. This amounted to an 
expenditure in Florida of $14,615,100. The relative impact of 
the industrial chemicals sector on Florida is about the same 



as that of the phosphatic fertilizers sector but is considerably 
less than that of the mining sector. 

The major Florida purchases of the industrial chemicals 
sector were electrical services, phosphate rock, and labor. 
These three categories alone amounted to about 90 percent 
of all the sector's purchases from Florida. The industrial 
chemicals sector is the most energy-intensive of the three 
sectors, because of its use of electric furnaces in the man- 
ufacture of elemental phosphorus. Inputs this sector obtains 
from outside the State include petroleum products, coke, and 
silica. 



Distribution of Sales 

MINING SECTOR 

Estimates of the distribution of mining sector sales by Flor- 
ida firms are given in table B-8 for 1 976. About 52 percent 
of the 35,834,000 metric tons of phosphate rock sold from 
Florida plants was used within the State in the production of 



Table B-8.— Estimates of the distribution of sales by the mining sector of the Florida phosphate complex, 1976 1 



Market 


Quantity sold, thousand 
metric tons 


Percent 
of total 


Fetilizer chemicals sector: 

Florida __ 

Rest of United States 


18,404 
8,807 

( 3 ) 
8,275 


52 
25 


Industrial chemicals sector: 2 Florida 

Exports 


( 4 ) 
23 


Total ____ 


35,800 


100 



' Based on data obtained from a Bureau of Mines survey; interviews by Florida State University personnel; the Ports of Jacksonville, Tampa, and Boca Grande; 
and the Florida Phosphate Council. 

2 Data for the rest of the United States were not available for this sector. 

3 Less than 500,000 metric tons. 
" Less than 1 percent. 



55 

Table B-9.— Estimates of the distribution of sales by the fertilizer and industrial chemicals sectors of the Florida 

phosphate complex, by product line, 1976 



Product 



Quantity sold, thousand 
metric tons 


223.2 
987.0 
1 772 
NA 



395.0 
'2,819.8 
.3 



Domestic sales (Florida and United States): 

Sulfuric acid 

Phosphoric acid _ 

Superphosphates and other fertilizer materials 
Phosphorus 

Export sales: 

Sulfuric acid 

Phosphoric acid 

Superphosphates and other fertilizer materials 
Phosphorus 



NA Not available. 

' Exports and domestic shipments of superphosphates and other fertilizer materials exceeded Florida production by 601 ,000 metric tons. This reflected a drawdown 
of inventories and may have also resulted in part from differences in data classification. 

Sources: U.S. Department of Commerce, Bureau of the Census: and Port Authorities of Tampa, Boca Grande, and Jacksonville. 



fertilizer chemicals. About 25 percent of this total went to 
other States for further processing, and about 23 percent was 
exported. A very small portion of the mining sector's output 
was used in the production of industrial chemical" The per- 
centages shown in table B-8 reflect tonnages sold and not 
the value of sales. Since export prices are considerably higher 
than the domestic price of phosphate rock, a distribution ac- 
cording to sales value would be significantly different 4han 
the distribution shown in this table. 

The largest importers of Florida phosphate rock are Bel- 
gium, Brazil, Canada, Japan, Iran, the Republic of Korea, 
Mexico, and the Netherlands. In addition, France, India, and 
Poland import significant amounts of Florida rock. Most of 
Florida's exported phosphate rock tonnage is shipped from 
the Port of Tampa. 



FERTILIZER AND INDUSTRIAL CHEMICALS 
SECTORS 

The preponderance of sales by these sectors are sales of 
agricultural chemicals. Most of the fertilizer chemicals are 
sold for export. In 1976 nearly 2,820,000 million metric tons 
of superphosphates and other fertilizer materials were ex- 
ported (table B-9). Brazil, France, India, Italy, and Poland 
are all major importers of Florida fertilizer chemicals. 

Phosphoric acid is the primary product sold domestically 
by the Florida fertilizer and industrial chemicals sectors. It is 
used in both agricultural and industrial activities. The two 
sectors' sales of phosphoric acid in 1 976 amounted to 987,01 7 
metric tons. Large tonnages of both phosphoric and sulfuric 
acid are produced and used internally in the Florida phos- 
phate complex and are therefore not included in table B-9, 
which shows only interfirm sales. A major portion of the 223,1 68 
metric tons of sulfuric acid sold in the United States in 1976 
represented byproduct sales by Florida plants primarily en- 
gaged in phosphoric acid production. 






56 



APPENDIX C— AGRICULTURAL FORWARD LINKAGE 1 



Precise knowledge of the total value of agricultural products 
which can be attributed to phosphatic fertilizer use requires 
information on the contribution of the fertilizer input with all 
other inputs held constant. This information is needed at two 
stages of production: (a) farm receipts and (b) retail outlet 
receipts. 

We attempted to solve this problem in the following way. 
First, through the use of production function theory in con- 
junction with a very large sample of experimental data, we 
estimated the marginal contribution of phosphatic fertilizer to 
the value of four important crops. Although the experimental 
data are more than 1 years old (D. B. Ibach and J. R. Adams, 
1968), the crop yield functions developed from the data gave 
yield results for 1976 that were in the most important case 
close to actual 1976 farm-gate prices of the four major crops 
in order to obtain estimates of additional value added to the 
product. 

Crop yield estimates were developed for major crops in 
each state by parts of the 99 agricultural subregions (ASR's) 
in the United States for 1964 (D. B. Ibach and J. R. Adams, 
1968). The yield curves indicate yields at different rates of 
application of the nutrient to which the yield response is great- 
est, usually nitrogen. However, the yield curve could be re- 
estimated in terms of the yield response of phosphorus be- 
cause the applications of each nutrient were not at fixed 
ratios. 

The following method is used. The estimated yield function 
(in terms of nitrogen) is 



Y = M - AR X , 



o: 



where Y = bushels per acre; M = maximum potential yield, 
A = the coefficient of R x , R x = the exponential yield function. 
Given an initial sample value of R x , say R x 1 , successive val- 
ues of R x are derived by multiplying R x 1 by the relative fer- 
tilizer application rates; i.e., 



N + P + K in selected application 
N + P + K in initial application 



(2) 



The amount of P (phosphorus oxide) per unit of x(Q ) is 

n 

P 

i = 1 



Q D 



(3) 



where the quantity of phosphate applied in each sample is 
summed across all samples and x = exponent in yield func- 
tion at the observation in question. Therefore, Q p is the 
amount of phosphate per unit of the yield exponent. The value 
of Q p , can be viewed as the marginal input of phosphorus at 
the ith observation. The value of the yield (Y) at the imme- 
diately preceding observation minus the yield at the ith ob- 
servation is the marginal yield. The ratio of the marginal yield 
(AY,) to the marginal phosphorus application (Q p ,) is the mar- 
ginal product of phosphorus application at the ith observation, 
or 



MP„. = 



AY 

Q n , 



(4) 



The average product can be found by the following formula 

Y, 



AP " = Q P .,-x, 



(5) 



for the ith observation. 

Six crops account for about 82% of the U.S. agricultural 
consumption of phosphatic fertilizer. They are grain corn, 
wheat, cotton, soybeans, hay and pasture, oats, and barley. 
Fertilizer application data are available only on corn, wheat, 
cotton, and soybeans. Applications of phosphate on these 
four major crops accounted for 62% of total phosphatic fer- 
tilizer used in agriculture in 1976. 

Yield functions with respect to phosphorus for corn, wheat, 
cotton, and soybeans were estimated for the leading pro- 
ducing states from all ASR's in these states: Iowa corn, Kan- 
sas wheat, Texas upland cotton, and Illinois soybeans. Av- 
erage and marginal products were calculated as described 
above. It was found that 1976 phosphorus application rates 
placed production near the peak of the 1 964 yield curves for 
each crop. Therefore, only marginal products were used to 
calculate production values. 

The following assumptions are invoked: 

(1) The slope of the 1976 yield curves approximate those 
of 1964; 

(2) As the greatest production of each crop takes place in 
the selected state, it is assumed that the yield curve slope 
applies to all harvested lands; 

(3) Farmers received the average price on each crop in 
1976. 

The farm-gate value of that part of each crop that could be 
attributed to phosphatic fertilizer application was calculated 
as follows: 



Phos- 


Total 


phorus 


acres 


value of 


receiving 


crop 


P 2 5 



Average 
P 2 5 ap- 
plication 



Marginal 

x product x 

P.O. 



Average 
crop 
price, 
1976 



The values used appear in table C-1 ; and the estimated 
1976 total crop values related to phosphate fertilizer appear 
in table C-2. Some $1 .8 billion of agricultural crop value can 
be directly traced to the use of phosphatic fertilizers in 1976. 

By far the greatest share of the total value is found in 
applications to the corn crop: some 65% of the value of the 
four crops is found in corn yields and some 22% in wheat 
yields. 

How accurate are estimates derived from 1964 yield data? 
The data base, while dated, is very rich in the sense that a 

Table C-1 .—Estimated marginal products, phosphatic 

fertilizer application rates, and average crop prices, 

1976 



Crop 


Marginal product 
per acre, 
bushels 


p 2 o 5 

application 

rate, 

pounds 


Average 
price 


Corn 

All wheat 


0.112 
.107 

'1.22 
.003 


66.7 
37.2 
52.1 
42.3 


$2.49 
3.14 


Cotton (upland) 
Soybeans 


.575 
5.58 



'Chapter from reference 6. 



Pounds. 



57 



Table C-2.— Estimated crop value attributed to the use 
of phosphatic fertilizer, 1972 



Crop 


Values 


Percent 
of total 


Corn 

Wheat 

Cotton 

Soybeans 


$1,189,945,636 

406,140,058 

220,624,569 

9,847,237 


65 
22 

12 

1 


Total .... 


1,826,557,500 


100 



Tabic C-4.— 


Uses of corn as final 


product, 


1975-76 


Product 


The jsand 
bushels 


Percent 
of total 


Animal feed 


3,558,400 

400,800 

71,100 

19,100 




87.8 


Direct food 


9.9 


Alcoholic beverages 
Seed 




1.8 
.5 


Total 


4,049,400 


100.0 



large number of observations were amassed over very di- 
verse soil and weather conditions in each state. However, it 
is possible that either the yield curves have since shifted up 
or down and/or the slope of the yield curves changed. Parallel 
shifts in the yield curves would not alter our marginal product 
findings. 

The accuracy of the results can be assessed by comparing 
predicted 1976 yields from the 1964 yield curve with actual 
1976 yields. This comparison is presented in table C-3. For 
the most important crop, grain corn, the yields are almost 
identical. The yields for soybeans are not greatly divergent. 
However, the yield differences for wheat and cotton (upland) 
are substantial. We believe that the wheat yield curve shifted 
downward in 1976, leaving marginal products (in terms of 
phosphorus application) relatively unchanged. The average 
wheat yield in 1964 is close to the 1976 average yield. In the 
case of cotton it is possible that the yield-curve slope has 
changed in addition to the yield curve shifting upward; we 
cannot be certain. 

If all of the increase in the 1 976 cotton yield compared with 
1964 is a result of an increase in marginal products unas- 
sociated with phosphorus, the total phosphorus value of the 
crop should be reduced by $1 09,429,780, which is 6% of the 
estimated total value of the four crops. 

Recall that the total value of $1 .8 billion underestimates 
production due to phosphatic fertilizers since the four crops 
considered account for only 62% of total phosphatic fertilizer 
used in agriculture in 1976. This is true provided that the 
marginal physical product of phosphatic fertilizers related to 
the excluded crops is positive. 

The estimated crops value of phosphatic fertilizer is only 
the "first round" impact from its application. Corn, wheat, and 
soybeans are further processed into food for both human and 
farm animal consumption. In turn, beef cattle, dairy cows, 
pigs, and poultry are consumed by persons, at the retail level. 
Cotton is processed as fiber into cloth which is used to pro- 
duce clothing. 

Of the four crops, the most important in initial value (as we 
see in table C-2) is grain corn. We are able to trace the 
phosphorus-related value of com all the way to the meat 



Tabic C-3.— Comparison of predicted and actual crop 
yields, 1976 



Table C-5. — Estimated value added by phosphatic 
fertilizers to dairy and meat products, 1976 



Crop 


Yield predicted 

at 1976 P 2 5 

application 

rate, bushels 


Actual 
1976 
yield, 

bushels 


Percent of 
predicted 

yield 
actually 
realized 


Grain corn 


94.5 

49.4 

'310.2 

36.4 


87.4 

30.3 

'464.0 

25.6 


92.5 


All wheat 


61.3 


Cotton (upland) 
Soybeans 


149.6 
70.3 



Product 


Value added 


Beef 


$601,251,800 


Pork 


313,288,190 


Milk 


12,825,034 


Broilers and turkeys 




734,771 








Total 


928,099,795 







Table C-6 — Total estimated Phosphorus-produced 
retail Value of major related final products, 1976 



Product 


Phosphorus-produced value 


Crops __ — - 

Dairy and meat products 


$1,826,557,500 
928,099,795 


Cotton clothing 


211,799,560 






Total - - 


2,966,456,855 



Pounds. 



market in the grocery store. The mark-ups on cotton are very 
straightforward, and we are able to derive a retail value for 
phosphorus-related cotton output. However, wheat and soy- 
beans are more difficult to trace than even corn. Of these, 
soybeans are relatively unimportant in magnitude and wheat 
is much less significant than corn. In any case, given time 
and budget constraints we are unable to supply the retail 
values of phosphorus-related wheat and soybeans output. 

The final product use of com is varied. Its uses in the 
1975-76 market year are detailed in table C-4. By far, corn's 
greatest value is indirect, through the feeding of livestock and 
poultry that later is processed as human food. Nearly 90% 
of corn is used for this purpose. Therefore, we will estimate 
its value as beef, pork, poultry, and milk. 

During the 1975-76 market year corn was fed to animals 
as either a concentrate or directly as field corn. We applied 
the following procedure to the valuation of corn-fed beef, dairy 
cows (for milk), and poultry: 

(1) All grain corn concentrate was converted to bushels of 
corn; 

(2) The amount of corn per pound of animal was estimated; 

(3) The total pounds of meat (or milk) attributable to the 
phosphorus-related amount of corn was computed; 

(4) The meat (or milk) poundage related to phosphorus 
was multiplied by the average retail price of the meat or milk. 
The values are reported in table C-5. It is emphasized that 
this is a very rough estimate of these values. 

Raw cotton fiber was marked up by 48% at the textile mill 
in 1976. If we further assume that wholesale and retail mark- 
ups total 100% for cotton clothing, the value-added or the 
final product related to phosphorus is $21 1 ,799,560. 

These estimated values are summed in table C-6. The total 
product value is nearly $3 billion. 



58 

APPENDIX D.— A REGIONAL ECONOMIC IMPACT SCENARIO OF ASSUMED DECLINES 
IN MINERAL PRODUCTION FOR THE PHOSPHATE ROCK MINING INDUSTRY IN 

FLORIDA 



Background 

The U.S. phosphate industry is presently stable, as is the 
position of U.S. phosphate rock and its derivative products 
in world markets. A review of U.S. phosphate rock mining 
and processing with respect to regional economic impact 
suggests that the continued viability of the phosphate industry 
in Florida will be influenced by the existing industry conditions 
listed below. These conditions are the basis for the scenario 
which is presented later in this appendix. 

1. The United States currently mines and processes 40 
percent of the world's phosphate rock. 

2. The State of Florida in 1978 accounted for 80 percent 
of the U.S. production of phosphate rock. 

3. Florida produced about one-third of the world supply of 
phosphate rock in 1978. 

4. The real costs of new investment capital for the phos- 
phate industry have been increasing by 6 percent per year, 
while the real prices of phosphate-related products have been 
falling since 1975. 

5. Florida's high-quality reserves in Polk and Hillsborough 
Counties are being depleted and are expected to be largely 
exhausted by the end of the century. 

6. Environmental regulations and competition for water and 
energy in the central Florida mining region have not encour- 
aged new mine development. 

7. Technologically oriented productivity increases are lag- 
ging, i.e., there is a lack of new technology for concentrating 
low-quality, high-impurity phosphate ore deposits. 

8. The present transportation system for handling phos- 
phate rock and related products between the central Florida 
region and the Port of Tampa appears to be adequate, but 
with future increases in output, it is expected that this trans- 
portation system will become a restricting factor. 

9. Phosphate rock and derivative products are internation- 
ally traded commodities. The competitive position of Florida 
resources may decline as higher cost mines replace older, 
depleted low-cost mines. This could possibly limit the incen- 
tive to expand Florida's phosphate rock mining capacity. 

Based upon these conditions, and an assumption of de- 
clining production, the scenario which follows is intended as 
a projection of the economic profile of the Florida phosphate 
industry for 1990. Currently, approximately 20 phosphate rock 
mines are operating in Florida, producing approximately 40 
million metric tons of rock per year. It is assumed in the 
scenario that Florida production of phosphate rock will reach 
a peak in 1985, and maintain the peak level until roughly 
1987, and decline thereafter. The scenario considers the ef- 
fects of a decline in output from 1987 to 1990, but the year 
1990 is highlighted. 

METHODOLOGY 

After the factors which may restrict growth are identified, 
a scenario is suggested that could represent the market sit- 
uation in 1 990. From this scenario, a likely set of employment, 
income, and fiscal impacts are identified. These impacts are 
based on an interindustry input-output (l-O) table adapted for 
the State of Florida (17). From the l-O table, a set of type I 



and type II income and employment multipliers were derived, 
along with a multiplier that identifies the magnitude of changes 
in both direct and indirect output (19). 

The output multipliers for the phosphate industry measure 
the sum of direct and indirect requirements from all sectors 
needed to deliver one additional dollar of phosphate industry 
output to final demand (consumers). These multipliers were 
derived by summing the entries in the column of phosphate 
industry data in the Leontief inverse matrix table, 1 which showed 
the direct and indirect requirements per unit (one dollar) of 
final demand for each sector. 

The type I income multiplier expresses the ratio of the direct 
plus the indirect income change to the direct income change 
resulting from a unit increase in final demand for the phos- 
phate industry. While the type II multiplier is the ratio of the 
direct, indirect and induced income change due to a unit 
increase in final demand. The type II multiplier takes into 
account the repercussionary effects of secondary rounds of 
consumer spending in addition to the direct and indirect in- 
terindustry effects. 

The employment multiplier is analogous to the type I in- 
come multiplier and is the ratio of the direct plus indirect 
employment change to the direct employment change. Sim- 
ilarly, the employment multiplier is parallel to the type II in- 
come multiplier, it measures the ratio of the direct, indirect 
and induced employment change to the direct employment 
change. 

The fiscal impact on the state for 1 990 was based on tax 
rates for years that information was readily available and 
valued in 1977 dollars. 



Assumptions 



The following assumptions were made for calculation pur- 
poses: 

1 . The market price of phosphate rock is expected to reflect 
the real costs of new investment capital, production cost, and 
inflation. From a supplier's point of view, a higher selling price 
is justified when there is an increase in the cost of production. 
On the demand side (from the consumer's point of view), a 
price increase is acceptable only when there is a real short- 
age of phosphate rock. For example, if the demand for phos- 
phate rock is greater than the quantity supplied, a price in- 
crease is justified in order to allocate resources efficiently. 

2. The proportion of phosphate rock equivalent available 
for export is a function of the level of domestic production 
and domestic price, foreign demand, and relative interna- 
tional price. 

3. Technology and productivity are expected to be gen- 
erally stable for the next decade. No radical breakthroughs 
in technology or significant increases in productivity are an- 
ticipated. The assumption is made that any technological 
innovation that would increase productivity in the next decade 
will be offset as the richer ores are depleted and ores of lower 
grade with more impurities are mined. 






1 The Leontief inverse matrix table was derived from a direct requirements I- 
O table prepared for the State of Florida. 



59 



4. The present number of employees per million tons of 
output, as factor inputs, will approximate the employment 
utilization rate for the 1981-90 decade. 

5. The reserve position of phosphate rock will vary directly 
with the inflation-adjusted price and any changes in tech- 
nology that take place in the next 1 years. 

6. The transportation system that exists in Florida at the 
present time — mainly the railroad and trucking system— is 
typical of the system that will exist there in 1990. 

7. As a result of inflation and increasing costs, the valuation 
of phosphate rock for State severence tax purposes (which 
is based on operating costs) is expected to increase. An 
increase in this tax would be viewed by the industry as a cost 
and would be passed on to the consumer in the form of higher 
prices. 



Analytical Strengths and Weaknesses 



The strength of the type of analysis used in this scenario 
is its usefulness in identifying the factors that must be con- 
sidered in order to approximate future conditions based on 
existing identified trends. The shortcoming of this type of 
analysis, however, is its assumption that all relevant factors, 
other than those for which changes are stipulated, will remain 
unaltered. In all likelihood, even if the predictions of this scen- 
ario hold up, the pricing structure of the market will be altered 
in response to changes in supply. 



Scenario for 1990 



In this scenario, probable economic conditions are as- 
sumed which could by the end of this decade inhibit the long- 
term growth that has been characteristic of the Florida phos- 
phate industry. Specifically, it is the growth of the industry's 
new and replacement productive capacity that is expected to 
be limited by future economic constraints, according to this 
scenario. Consequently, the scenario assumes that produc- 
tion by the Florida phosphate industry will be declining by the 
end of the decade. 

The scenario describes the projected regional impact that 
the assumed decline in production would have on the State 
of Florida and also projects the value of the lost output (phos- 
phate rock and fertilizer products) that would result. The prob- 
able employment, income, and fiscal impacts that capacity 
reductions would have for the year 1990 are also analyzed. 

ASSUMED LIMITS TO GROWTH 

The assumed limits to the industry's capacity growth have 
to do with the price of phosphate rock, capital costs, ore 
extraction considerations, government regulation, and the 
adequacy of transportation between the Florida phosphate 
district and the Port of Tampa. In addition to these constraints, 
lags in capacity growth are also expected to result from the 
depletion of reserves in operating mines. 

Price 

Probably the most important of the assumed limits to ca- 
pacity growth will be the price of phosphate rock. At the 
present time, it appears that the price of phosphate rock is 
stable, but all indications suggest that the price will increase 



in the future. If the price does increase, it is likely that this 
would weaken the competitive position of Florida and other 
U.S. phosphate rock in the wond market. 

Capital Costs 

It has been estimated by the Bureau that real capital costs 
of the phosphate industry are increasing by 6 percent a year. 
If the market price of phosphate rock does not keep pace 
with escalating capital costs, investment will likely be dis- 
couraged. 

Ore Extraction Considerations 

The location and quality of phosphate ore are major factors 
in evaluating the costs of extraction. Compared with previ- 
ously mined deposits, some new deposits have deeper ov- 
erburdens, thicker matrices, lower pebble-to-feed ratios, lower 
grade ore compositions, and higher levels of impurities. It is 
expected that these factors will result in increased production 
costs and delays in development. 

Further delays and additional costs are expected to arise 
from the development of commensurate technology for han- 
dling the ore bodies. Through new technology it may be pos- 
sible to extract more phosphate from the matrix, but this 
technology has yet to be developed. 

Government Regulation 

The Florida phosphate industry is under the authority of 
numerous Federal, State, county, and district agencies and 
regulations. Regulation by these agencies can result in eco- 
nomic impacts for the industry. In the next decade, environ- 
mental regulations, in particular, may lead to economic im- 
pacts, both in terms of delays in development of new mines 
and increased costs. These delays and cost increases may 
in turn adversely affect expansion of the industry's productive 
capacity, either directly or indirectly. 

From 5 to 7 years may elapse between the time a firm 
decides to mine at a specific location and the time that ap- 
proval for mining is received. The process leading to approval 
to mine begins with a Development of Regional Impact (DRI) 
application. This is a document prepared by the mining com- 
pany that details proposed construction, mining, and plant 
operations. The DRI application details the impact of the pro- 
posed mining on housing, roads, water resources, air quality, 
etc. It is reviewed by local, regional, and State bodies. If the 
DRI is approved, the company may then apply for mining 
permits from the regulatory agencies. A list of agencies from 
which permits must be obtained is provided in table D-1 . 

After approval of a DRI, each mining operation is subject 
to regulation by Federal agencies, including the Environ- 
mental Protection Agency (EPA), Occupational Safety and 
Health Administration (OSHA), Mining Enforcement and Safety 
Administration (MESA), and the U.S. Geological Survey 
(USGS). In addition, phosphate operations in Polk and Hills- 
borough Counties are subject to the authority of the following 
State, county, and district agencies and regulations: 

1 . Florida Department of Natural Resources 

2. County Protective Development Regulation 

3. County Lime Rock Mining Ordinance 

4. County Zoning Ordinance 

5. County Building Code 

6. County Health Department 

7. County Environmental Protection Act 

8. Southwest Florida Water Management District 



60 



TABLE D-1.— Mining and processing permits and 
approvals 



Permit 1 



Agency 



FEDERAL 



Ambient Air Quality (CAA) 



Emission Standards (CAA) 

Pre-Construction Review and Approval 
(CAA) 

Water Quality (CWA, NPDES) 

Dredge and Fill permit (NPDES) .... 
Environmental Impact Statement 
(NEPA) 



U.S. Environmental Protection 
Agency. 
Do. 
Do. 

Do. 
U.S. Army Corps of Engineers. 
Council of Environmental Quality 
and responsible agency. 



STATE 



Development of Regional Impact ... 


Division of State Planning (through 




Regional Planning Council). 


Air Quality (FAWPCA): 


Department of Environmental Reg- 




ulation. 


Permits to construct 


Do. 


Permits to operate 


Do. 


Permits to maintain 


Do. 


Permits to expand 


Do. 


Permits to modify 


Do. 


Water Quality (FAWPCA): 


Do. 


Industrial Waste Water 


Do. 


Dredge and fill 


Do. 


Drainage well permit 


Do. 


Potable Water Supplies (FSDWA) .. 


Do. 


Dam Construction 


Do. 


Construction of Wells 


Water Management District. 


Consumption Water Use 


Do. 


Works of the District 


Do. 


Management and Storage of Surface 


Do. 


Waters 




Licensing of Radioactive Material ... 


Department of Health and Reha- 




bilitative Services. 


Reclamation 


Department of Natural Resources. 



LOCAL 



Zoning 

Operating (Mining Ordinance) 

Master Plan approval 

Development Order 

Building permit 

Pollution Control 

Well Drilling 



(County government). 
Do. 
Do. 
Do. 
Do. 
Do. 
Do. 



1 Abbreviations shown in this column are identified as follows: Federal: CAA, 
Clean Air Act; CWA-NPDES, Clean Water Act-National Pollutant Dis- 
charge Elimination System; NEPA, National Environmental Policy Act; 
State: FAWPCA, Florida Air and Water Pollution Control Act; FSWDA, 
Florida Safe Drinking Water Act. 

9. Florida Department of Environmental Regulation 
As mining progresses into other counties, similar ordinances, 
codes, and regulations may also be adopted by those coun- 
ties. 

Transportation 

Another possible constraint on capacity growth is the un- 
certainty of the continued development of an adequate trans- 
portation system for phosphate rock and related products. 
The rail and truck transportation corridor between the central 
Florida phosphate district and the Port of Tampa is presently 
operating near capacity. 

The major portion of the total rail traffic in the corridor is 
comprised of trains carrying phosphate rock, phosphate prod- 
ucts, and/or related products. Rail is the primary mode for 
high-volume movements of dry phosphate rock from bene- 
ficiation plants to shipping ports and from beneficiation plants 
to chemical plants (7). In 1977 rail traffic in the corridor nan- 



Table D-2. — Estimated tonnage of truck shipments 
between Tampa and phosphate plants, 1977. 



Product 


Total 
shipments, 
short tons 


Loads 
per 
day 


Tampa to phosphate plants: 

Fuel oils, Nos. 5 and 6 


'4,400,000 

3,500,000 

165,000 

145,000 

NA 

2,000,000 

1 ,400,000 
825,000 
187,000 


120 


Sulfur, molten 

Ammonia, anhydrous 

Caustic soda 


450 
32 
20 


Diesel fuels 


NA 


Phosphate rock plants to Tampa: 

Phosphate rock 

Triple superphosphate and diammonium 

phosphate 

Phosphoric acid 

Defluorinated phosphate 


260 

148 

110 
27 







NA Not available. 
1 Barrels. 



died more than 14 million short tons of phosphate products 
for international trade and another 9 million short tons for the 
domestic market. The volume of phosphate and other rail 
traffic is so large, however, that it significantly contributes to 
motor vehicle traffic congestion. The railroad crosses a major 
highway at least three times on its route from the mining 
district to the Port of Tampa. As a result, trains crossing the 
highway cause motor vehicle traffic congestion at any time 
of day, 7 days a week. There are as many as 10 trains daily, 
and each causes a 15-minute delay, so there can be delays 
totaling 2 1 /2 hours each day at each crossing. 

Trucks also use this transportation corridor to haul phos- 
phate rock and related products. In 1 977 the trucking industry 
hauled approximately 2 million short tons of phosphate rock 
to the Port of Tampa, as shown in table D-2. The same trucks 
took back to the phosphate district 3.5 million short tons of 
liquid sulfur; 4.4 million short tons (combined) of diesel fuel, 
fuel oil for flotation, gasoline, and kerosene; and other items 
(6). 2 

ASSUMPTION OF DECLINING PRODUCTION 

The assumption is made in this scenario that phosphate 
rock production in Florida will increase from 40 million metric 
tons in 1979 to approximately 55 million metric tons per year 
in the 1 985-87 period. Expansion of existing mines and planned 
new mines are expected to account for the increase. How- 
ever, it is further assumed that production will decline after 
1987, falling off to 47 million metric tons in 1990. At the 
present time, only a few companies are known to be planning 
the introduction of replacement capacity to offset this antic- 
ipated decline in production. This means that a net reduction 
in output of approximately 8.8 million metric tons can be 
expected between 1987 and 1990. This loss of output would 
amount to 1 6 percent of the projected annual production for 
the 1985-87 period. 

EFFECTS OF DECLINING PRODUCTION 

The impact of the previously described assumed bottle- 
necks to capacity expansion and utilization and the projected 
production decline of 8.8 million metric tons of phosphate 
rock between 1 987 and 1 990 is projected below for the year 
1990. A capacity utilization rate of 90 percent is projected. It 



2 Also based on Tampa Port Authority data and other data. 



61 



is assumed that the decline in production will have a similar 
direct effect on the manufacturing of phosphate fertilizer and 
related products. 



Direct and Indirect Output 

Based on interindustry input-output multipliers that have 
been developed for the Bureau for regional impact use (17, 
36) the following measurements of the Florida phosphate 
industry's direct and indirect output are expected in 1 990 (with 
estimates given in million 1977 dollars): 





Mining 
benefication 


Fertilizer 
manufacturing 


Combined 


Direct output' 


196 
116 


209 
162 


2 405 


Indirect output 


277 


Total 


312 


371 


682 



1 Output is valued at 1977 prices and a weighted average of domestic and 
export product. 

2 Output has been adjusted for doublecounting of value added. 

Based solely on these projections, it is projected that the 
industry's direct output (sales) will decline by approximately 
$405 million by 1990, on an annual basis. The total effect of 
the projected production decline, however, would be greater 
than $405 million. In addition to sales by the phosphate in- 
dustry, sales of goods and services to the industry by its 
suppliers (or second-level effects) must also be included. In 
turn, third-level suppliers' sales (those necessitated by phos- 
phate industry activity to second-level suppliers) must also 
be included. In addition to the output effect, further reper- 
cussions would be felt throughout the Florida economy. The 
total direct and indirect output loss during 1990 is esitmated 
to be $682 million. Furthermore, it is likely that a similar sit- 
uation will exist in 1991. 



Employment and Income 

Employment and income would also be affected by a de- 
cline in phosphate production. An estimate of employment 
associated with the projected decline in production, as de- 
scribed above, has been calculated as follows for 1990: 

Number of jobs 

Direct 1 2,000 

Indirect 1,800 

Induced 4,000 

Total 7,800 

1 The assumption is made that the employment effect would weigh 
equally on the mining and benefication and the fertilizer proc- 
essing industries. 

The total employment effect of the reduction in capacity would 
be the loss of approximately 7,800 jobs. Since the phosphate 
industry's employees are among the highest paid in the State, 
the loss of these jobs would result in a significant income 
loss. It is estimated that a total employment income of $74 
million will be lost in 1 990 due to restricted capacity growth 
of the Florida phosphate industry. This $74 million in projected 
lost income, which was previously included in the total output 
figure of $682 million, is broken down as follows, in million 
1977 dollars: 



Direct income 26 

Indirect Income 19 

Induced income 29 

Total 74 



Taxes 

Along with the income effect, it is projected that a corre- 
sponding tax revenue or fiscal impact will be felt at all levels 
of Florida government. Based on the amount of 1 976 property 
taxes paid by the phosphate industry, it is estimated that the 
State will lose approximately $6 million in property taxes from 
•he industry in 1990. This tax loss and other projected tax 
losses for 1990 are shown below, in million 1977 dollars. 

State property taxes 6.0 

State corporate income tax .6 

State severence tax 10.0 

Ad valorem county tax .8 

Total 17.4 



The State corporate income tax loss is estimated to be 
$600,000, based on the State corporate income tax the in- 
dustry paid in 1976. The loss in State severence tax is es- 
timated at approximately $10.0 million — which is a very con- 
servative estimate — based on the 1977 severence tax rate 
of $1 .27 per metric ton. 3 The ad valorem county tax loss is 
estimated at $794,000, which is based on the approximate 
1977-78 tax paid by the industry. It is estimated that the total 
loss of Florida tax revenues as a result of the projected de- 
cline in phosphate production will be $1 7.4 million for the year 
1990(6, 22). 

Possible Benefits of Production Delays 

A discussion of this scenario would not be complete without 
some mention of the possible beneficial effects that delays 
in phosphate rock production could have. Delays in produc- 
tion would provide technological innovation time for seeking 
solutions to the many problems involved in recovering larger 
quantities of lower grade phosphate from the matrix and pos- 
sibly shortening the time required to reclaim land for other 
useful purposes. Production delays would also extend the 
life of reserves. In addition, some land that might otherwise 
be used for mining could possibly be released for other uses 
as a result of delays in production; these other uses might 
include agricultural, residential, commercial, or recreational 
uses. 



SUMMARY AND CONCLUSIONS 

It is assumed that the capacity growth of the Florida phos- 
phate industry will be restricted by the end of this decade as 
a result of the depletion of high-grade reserves and also 
because of certain economic, environmental, regulatory, 
technological, and transportation constraints. As a result of 
this restricted growth, the following effects, relative to the 
Florida phosphate industry, are projected for the year 1990: 4 



3 This severance tax rate was applied to 10 percent of the value of the phos- 
phate rock at the point of severance. This tax applies only in Florida (11). 

4 All values are in 1977 dollars. 



62 

1. There will be a loss in direct output of 8.8 million metric 3. The income loss due to restricted capacity (which is 
tons of phosphate rock and 2.6 million metric tons of phos- included in the value of output described above) will total 
phate fertilizer with a combined value of $405 million. To- approximately $74 million. 

gether with a commensurate $277 million loss of output in 4. It is estimated that the State of Florida will lose $17.4 

secondary and tertiary industries, the total projected loss of million in tax revenues. 

output is $682 million. If the restrictions to capacity growth were to persist beyond 

2. The total employment effect, including direct, indirect, 1990, the above effects would be expected to continue for 
and induced employment, will be the loss of 7,800 jobs. successive years. 



*U S GOVERNMENT PRINTING OFFICE: 1981 351-518/8603 



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